Key Concepts: The Perfectly Competitive Firm in the Short Run, The Long Run

Priceline.com

Click on the "How it Works" tab to read about basic Priceline.com service information.

• How can Priceline.com offer prices on hotels and airline tickets that are 40% to 50% below retail prices?
• Under what condition is a proposed or asking price for airline tickets refused by participating airlines (Hint: Consider break-even price)?
• Visit Ubid.com. Explain why having "no reserve price" may help to increase consumer surplus in the market.
• Explain how services like mySimon.com bring about more competitive markets.