With peak-load pricing, the firm

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    charges lower prices during peak periods, which increases capacity utilization and profits.
     charges higher prices during peak periods, which increases producer surplus since marginal cost does not vary from period to period.
     attempts to increase economic efficiency by charging customers prices that vary with and are close to the marginal cost of production during different time periods.
     charges at all times the higher price that reflects marginal revenue and margin cost during peak demand periods to ensure a price high enough to cover marginal cost during all time periods.
asked Jun 2, 2013 in Economics by anonymous
    

1 Answer

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attempts to increase economic efficiency by charging customers prices that vary with and are close to the marginal cost of production during different time periods.
answered Jun 3, 2013 by Xyz ~Expert~ (3,650 points)



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