G202 EXAM 2 FINAL PAPER 2026 COMPLETE
QUESTIONS AND ANSWERS 100% CORRECT
◉ What is the result of Unilever's USLP differentiation strategy?
A) Unilever produces too few units, giving up some units that would
normally have more productive cost than consumer value.
B) Unilever sets a sales target where D=MC and then markup price
over costs according to demand for the firm's product.
C) Unilever sets higher prices to their shoppers as their demand is
relatively more inelastic.
D) Unilever only thinks about the short-term profit from their
differentiation efforts. Answer: C) Unilever sets higher prices to their
shoppers as their demand is relatively more inelastic.
◉ Which of the following is not one of the potential pros of doubling
down on the USLP?
A) There are diminishing returns to expanding the USLP beyond the
brands considered to be low-hanging fruit.
,B) Employees are motivated by the incentive structures of the USLP
and are driving product innovation.
C) The USLP generated early profit increases and improved
shareholder value.
D) Customers responded to the culture of social accountability
under the USLP by increasing their brand loyalty. Answer: A) There
are diminishing returns to expanding the USLP beyond the brands
considered to be low-hanging fruit.
◉ You are the manager of a movie theater that is the only one in a
local market, so you have strong market power. You have extensively
researched your customer base and realize you have two types of
segmentable customers: (i) students who have an elasticity of
demand for movies of -2.7 and (ii) senior citizens who have an
elasticity of demand for movies of -5.1. Which of the following
pricing schemes would you employ to enhance profits?
A) Set higher prices to the senior citizens as their demand is
relatively more inelastic.
B) Set higher prices to the students as their demand is relatively
more inelastic.
,C) Set higher prices to the students as their demand is relatively
more elastic.
D) Set higher prices to the senior citizens as their demand is
relatively more elastic. Answer: B) Set higher prices to the students
as their demand is relatively more inelastic.
◉ When firms are imperfectly price discriminating (charging
different prices to different segmented groups of consumers), which
of the following statements is true?
A) All market surplus goes to the consumers.
B) Over a given range of production, consumer surplus increases as
the number of segmented consumer groups increases.
C) All market surplus goes to the producers.
D) Over a given range of production, producer surplus increases as
the number of segmented consumer groups increases. Answer: D)
Over a given range of production, producer surplus increases as the
number of segmented consumer groups increases.
, ◉ When compared to the efficiently competitive industry, the firm
with significant market power produces
A) too many units, as some units produced will have more
productive costs than consumer value.
B) too many units, as some units produced will have more consumer
value than productive costs.
C) too few units, giving up some units that would normally have
more consumer value than productive cost.
D) too few units, giving up some units that would normally have
more productive cost than consumer value. Answer: C) too few units,
giving up some units that would normally have more consumer
value than productive cost.
◉ To achieve the socially efficient equilibrium, a firm with market
power should
A) set a sales target where MR=MC and then set price equal to
marginal cost at that output level.
QUESTIONS AND ANSWERS 100% CORRECT
◉ What is the result of Unilever's USLP differentiation strategy?
A) Unilever produces too few units, giving up some units that would
normally have more productive cost than consumer value.
B) Unilever sets a sales target where D=MC and then markup price
over costs according to demand for the firm's product.
C) Unilever sets higher prices to their shoppers as their demand is
relatively more inelastic.
D) Unilever only thinks about the short-term profit from their
differentiation efforts. Answer: C) Unilever sets higher prices to their
shoppers as their demand is relatively more inelastic.
◉ Which of the following is not one of the potential pros of doubling
down on the USLP?
A) There are diminishing returns to expanding the USLP beyond the
brands considered to be low-hanging fruit.
,B) Employees are motivated by the incentive structures of the USLP
and are driving product innovation.
C) The USLP generated early profit increases and improved
shareholder value.
D) Customers responded to the culture of social accountability
under the USLP by increasing their brand loyalty. Answer: A) There
are diminishing returns to expanding the USLP beyond the brands
considered to be low-hanging fruit.
◉ You are the manager of a movie theater that is the only one in a
local market, so you have strong market power. You have extensively
researched your customer base and realize you have two types of
segmentable customers: (i) students who have an elasticity of
demand for movies of -2.7 and (ii) senior citizens who have an
elasticity of demand for movies of -5.1. Which of the following
pricing schemes would you employ to enhance profits?
A) Set higher prices to the senior citizens as their demand is
relatively more inelastic.
B) Set higher prices to the students as their demand is relatively
more inelastic.
,C) Set higher prices to the students as their demand is relatively
more elastic.
D) Set higher prices to the senior citizens as their demand is
relatively more elastic. Answer: B) Set higher prices to the students
as their demand is relatively more inelastic.
◉ When firms are imperfectly price discriminating (charging
different prices to different segmented groups of consumers), which
of the following statements is true?
A) All market surplus goes to the consumers.
B) Over a given range of production, consumer surplus increases as
the number of segmented consumer groups increases.
C) All market surplus goes to the producers.
D) Over a given range of production, producer surplus increases as
the number of segmented consumer groups increases. Answer: D)
Over a given range of production, producer surplus increases as the
number of segmented consumer groups increases.
, ◉ When compared to the efficiently competitive industry, the firm
with significant market power produces
A) too many units, as some units produced will have more
productive costs than consumer value.
B) too many units, as some units produced will have more consumer
value than productive costs.
C) too few units, giving up some units that would normally have
more consumer value than productive cost.
D) too few units, giving up some units that would normally have
more productive cost than consumer value. Answer: C) too few units,
giving up some units that would normally have more consumer
value than productive cost.
◉ To achieve the socially efficient equilibrium, a firm with market
power should
A) set a sales target where MR=MC and then set price equal to
marginal cost at that output level.
