Question

There are two supermarkets. Supermarket A and Supermarket B are exactly the same prices on online....

There are two supermarkets. Supermarket A and Supermarket B are exactly the same prices on online. However, the prices of the two supermarkets in the stores are not the same as those on the Internet. Why the supermarket can not unify the price? In addition, why the supermarket does not use the price as the main competition? Use the economics of economics to explain this phenomenon.

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

The supermarket will not unify the price on stores because they can extract consumer surplus by quoting a higher price for the product but in online stores, they have to unify the price because consumers can easily compare the products and their price online.
The supermarket does not use the price competition because if they will do then due to price war price of the products converges to their marginal costs and thereby each and every firm earns a normal profit that's why there is not a price based competition.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Supermarket checkout lines all tend to be roughly the same length. Why is that? Explain your...
Supermarket checkout lines all tend to be roughly the same length. Why is that? Explain your answer using one or more concepts related to perfect competition and/or monopoly. (Note that this question is about the checkout lines within a particular store – the question is not about the number of supermarkets or grocery stores.)
you can either look at prices of a grocery product online or in a grocery store....
you can either look at prices of a grocery product online or in a grocery store. Pick a product that comes in at least two different sizes and compare the unit prices of that product at the same store or online. Pick a product and compare the unit price of that product at two different stores/online shops (the sizes can be the same or different). Give your answer in cents per unit size and round your answer to the nearest...
Each of three supermarket chains in the Denver area claims to have the lowest overall prices....
Each of three supermarket chains in the Denver area claims to have the lowest overall prices. As part of an investigative study on supermarket advertising, a local television station conducted a study by randomly selecting nine grocery items. Then, on the same day, an intern was sent to each of the three stores to purchase the nine items. From the receipts, the following data were recorded. At the 0.025 significance level, is there a difference in the mean price for...
Consider the college that has two prices for its services. It charges list price (full tuition)...
Consider the college that has two prices for its services. It charges list price (full tuition) to only a small portion of their students. Everyone else gets a discount (scholarship). This college does not set a low list price and charge a tuition premium to those few individuals who are not star students, athletes, or from low-income backgrounds. (a) Assume that the two prices are framed in terms of full tuition and scholarships. In terms of perceived gains and losses,...
Consider the college that has two prices for its services. It charges list price (full tuition)...
Consider the college that has two prices for its services. It charges list price (full tuition) to only a small portion of their students. Everyone else gets a discount (scholarship). This college does not set a low list price and charge a tuition premium to those few individuals who are not star students, athletes, or from low-income backgrounds. (a) Assume that the two prices are framed in terms of full tuition and scholarships. In terms of perceived gains and losses,...
Two online retailers offer a particular style of webcam for sale. The prices of these cameras...
Two online retailers offer a particular style of webcam for sale. The prices of these cameras vary day by day. Consider two groups: Group #1 consists of consumers who purchased a camera from retailer #1 during the past three months and Group #2 consistes of consumers who purchased a camera from retailer #2 during the same period of time. A 99% confidence interval for ?1−?2μ1−μ2, the difference in population mean sale prices, is 30 to 60 dollars. (b) The confidence...
To compare prices of two local stores, a random sample of items that are sold in...
To compare prices of two local stores, a random sample of items that are sold in both stores were selected and their price noted in the first weekend of the year: (12 marks) Item Store A Store B Difference (Store A - Store B) 1 1.65 1.99 -0.34 2 8.70 8.49 0.21 3 0.75 0.90 -0.15 4 1.05 0.99 0.06 5 11.30 11.99 -0.69 6 7.70 7.99 -0.29 What are the null and alternative hypothesis if we want to confirm...
Consider the college that has two prices for its services. It charges list price (full tuition)...
Consider the college that has two prices for its services. It charges list price (full tuition) to only a small portion of their students. Everyone else gets a discount (scholarship). This college does not set a low price and charge a tuition premium to those few individuals who are not star students, athletes, or from low-income backgrounds. (a) In terms of perceived gains and losses, describe how the recipient of a scholarship is likely to perceive the price he or...
Two firms are competing in prices. Each has two strategies: undercut and cooperate. The firms’ payoffs...
Two firms are competing in prices. Each has two strategies: undercut and cooperate. The firms’ payoffs are provided in the matrix below Undercut Firm 1 Cooperate Firm 2 Undercut Cooperate 100, 100 1000, 0 0, 1000 500, 500 (a) (3 points) Assume the firms make their decisions at the same time, and the firms’ competition lasts for one year. Does Firm 1 have a dominant strategy? Does Firm 2 have a dominant strategy? Find the Nash equilibrium. 2 (b) (2...
To compare prices of two grocery stores in Toronto, a random sample of items that are...
To compare prices of two grocery stores in Toronto, a random sample of items that are sold in both stores were selected and their price noted in the first weekend of July 2018: (12 Points) Item Store A Store B Difference (Store A - Store B) 1 1.65 1.98 -0.33 2 8.70 8.49 0.21 3 0.75 0.89 -0.14 4 1.05 0.99 0.06 5 11.30 11.99 -0.69 6 7.70 7.99 -0.29 7 6.55 6.99 -0.44 8 3.70 3.59 0.11 9 8.60...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT