Th3.4: ^^ Consumers Flashcards
1
Q
With a natural monopoly…
A
consumers tend to be better off than if there was competition
2
Q
What will happen when firms enjoy economies of scale?
A
they will be more efficient and customers will enjoy a higher consumer surplus
3
Q
Why may monopolists do due to cross subsidisation?
A
produce an increased range of goods or services
4
Q
What will the use of price discrimination allow?
A
survival of a product or service, and benefits some customers (those in cheap markets) whilst is negative for others - e.g it is said economy flights are funded by business flights
5
Q
What may consumers see due to a lack of competition?
A
see a poorer quality service and may pay higher prices
6
Q
Since there is only one firm producing the good, what might consumers see?
A
that there is less choice
