Economics 9708 · AS & A Level · Cross elasticity of demand

Cross elasticity of demand — practice question

Rather than setting one uniform price for every customer, a firm chooses to set different prices across separate markets. How will this probably influence consumer surplus and the firm's marketing costs?

  • Aconsumer surplus decrease; marketing costs decrease
  • Bconsumer surplus decrease; marketing costs increase
  • Cconsumer surplus increase; marketing costs decrease
  • Dconsumer surplus increase; marketing costs increase

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