A firm that faces a high- demand period followed by a low- demand period must determine all of the following for peak- load pricing except which one?
A)short- term off- peak quantity
B)short- term peak quantity
C)short- term peak price
D)long- term off- peak price

Question

Quizplus · Accepted Answer

The question asks for what the firm does not need to determine for peak-load pricing. As such, the answer is D, long-term off-peak price, since this is not a consideration for short-term peak load pricing. A firm setting peak-load pricing would need to determine short-term off-peak and peak quantities and prices in order to maximize revenue during both high and low-demand periods.

A Firm That Faces a High- Demand Period Followed by a Low-