Cameron sells premium steak at the local market. He has a lot of customers due to the promising taste and texture of his steak. One kilogram of his premium steak costs $80.50. However, it would only cost $68.50 per kilogram if a customer buys 3 kilograms and $58.50 per kilogram if a customer buys 5 kilograms. Cameron can supply 100 kilograms of premium steak in a day, but his supply only lasts for an hour and a half. Which of the following statements is true? With this pricing scheme, Cameron is extracting all the consumer surplus. O Cameron is basing his pricing scheme on the maximum amount a customer is willing to pay for his premium steak. Cameron is using third degree price discrimination by charging different prices for different "blocks" of kilograms for his premium steak. Cameron receives a larger revenue and profts with this pricing scheme compared to charging a single lower price for larger quantities. None of the above are true.

Cameron sells premium steak at the local market. He has a lot of customers due to the promising taste and texture of his steak. One kilogram of his premium steak costs $80.50. However, it would only cost $68.50 per kilogram if a customer buys 3 kilograms and $58.50 per kilogram if a customer buys 5 kilograms. Cameron can supply 100 kilograms of premium steak in a day, but his supply only lasts for an hour and a half. Which of the following statements is true? With this pricing scheme, Cameron is extracting all the consumer surplus. O Cameron is basing his pricing scheme on the maximum amount a customer is willing to pay for his premium steak. Cameron is using third degree price discrimination by charging different prices for different "blocks" of kilograms for his premium steak. Cameron receives a larger revenue and profts with this pricing scheme compared to charging a single lower price for larger quantities. None of the above are true.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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