Principles of Microeconomics, California Edition
2nd Edition
ISBN: 9780393622102
Author: Dirk Mateer, Lee Coppock
Publisher: NORTON
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Chapter 11, Problem 2SP
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Examples of
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Which of the following is NOT an example of price discrimination?
a.
Christmas sales
b.
student discounts at the supermarket
c.
discounted meals for children at Burger King
d.
airlines charging lower prices to travelers who travel on Sunday night
8. Examples of price discrimination
Brian and Eleanor are debating the use of coupons by grocery stores. Brian says, "The use of coupons in grocery stores represents a means of price
discrimination. It's pure and simple. Coupons do reduce the price of groceries, but mostly to people who are less likely to buy at the full price." By
contrast, Eleanor contends, "Coupons do not constitute price discrimination. They simply represent a way of temporarily changing the prices of some
grocery items. Coupons reduce the price for everyone, not just for those who are price sensitive."
Economists generally agree with
Chapter 11 Solutions
Principles of Microeconomics, California Edition
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- The following present different examples of price discrimination strategies. Match up the examples with the appropriate type of price discrimination. A university athletic department requires a donation prior to purchasing season tickets. A. Third-degree price discrimination A firm identifies different groups of customers in the market and offers different prices to each group. B. First-degree price discrimination A firm identifies and charges a unique price for each consumer in the market. C. Two-part tariff. D. Second-degree price discrimination A firm bundles together different products into packages with special prices.arrow_forwardWhat is price discrimination? Explain how the theories of elasticity, if used, can help suppliers make decisions on product prices.arrow_forwardThe practice of posting a discrete schedule of declining prices for different ranges of quantities. Select one: a. First-degree price discrimination b. Fourth degree price discrimination c. Third-degree price discrimination d. Fifth degree price discrimination e. Second-degree price discrimination.arrow_forward
- Which of the following statements regarding perfect price discrimination is false? Question 7Answer a. Perfect price discrimination yields the same market price and output result as perfect competition. b. Perfect price discrimination can eliminate the deadweight loss to society of a monopoly. c. Perfect price discrimination is an attempt by monopolists to capture consumer surplus as profit. d. Perfect price discrimination is charging different prices to different buyers.arrow_forwardWhich of the following cases are examples of price discrimination? 1. Airlines charge different fares for business people than tourist travelers. 2. Young males are charged higher premiums for car insurance than older males or women. 3. A local phone company charges different telephone rates to residential and business users. Select one: . A. 1 only B. 2 only C. 3 only D. 1 and 3 only E. 1, 2, and 3 xarrow_forwardWhat is price discrimination ? When is price discrimination possible ? What are the different types of price discrimination ? ( Please solve whole question I will give you upvote )arrow_forward
- 14. The only DVD rental club available to you charges $4 per movie per day. If your demand curve for movie rentals is given by P = 20 – 2Q, where P is the rental price ($/day) and Q is the quantity demanded (movies per year), what is the annual maximum fee you would be willing to pay to join the club?arrow_forwardCharging a price to different groups depending on their different demand elasticities is described as ... Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer. a b C Write your response here... d e Question 9 1st Deg Price Discrimination 2nd Deg Price Discrimination 3rd Deg Price Discrimination 2-part pricing Bundlingarrow_forwardThe following graph shows the daily demand curve for bippitybops in Chicago. Use the green rectangle (triangle symbols) to compute total revenue at various prices along the demand curve. Note: You will not be graded on any changes made to this graph. Total Revenue 0 8 16 24 32 40 48 56 64 72 80 200 180 160 140 120 100 80 60 40 20 0 PRICE (Dollars per bippitybop) QUANTITY (Bippitybops per day) Demand A B Area: 1280 Calculate the daily total revenue when the market price is $180, $160, $140, $120, $100, $80, $60, and $40 per bippitybop. Then, use the green point (triangle symbol) to plot the daily total revenue against quantity corresponding to these market prices on the following graph. Total Revenue 0 8 16 24 32 40 48 56 64 72 80 3840 3520 3200 2880 2560 2240 1920 1600 1280 960 640 320 0 TOTAL REVENUE (Dollars) QUANTITY (Bippitybops per day) According to the midpoints formula, the price elasticity of demand between points A and B on the initial graph is approximately . Suppose the…arrow_forward
- Is Cath Kidston’s pricing strategy sustainable? Explain?arrow_forwardThe following graph shows the daily demand curve for bikes in Chicago. Use the green rectangle (triangle symbols) to compute total revenue at various prices along the demand curve.arrow_forwardwork Due in 3 days a If you join a tennis club with a membership fee to get a cheaper monthly price, this is an example of ... Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. b C d HW9_15 Homework Unanswered e 1st Degree Price Discrimination 2nd Degree Price Discrimination 3rd Degree Price Discrimination Bundling Two part pricing 14/15 answered Unanswered Submitarrow_forward
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