A dry cleaner in California encountered controversy for charging more to dry clean women’s shirts than men’s shirts. As an unhappy female customer noted, “They charged me $1.50 for each of my husband’s shirts, and he wears an extra large. They charged $3.50 for each of mine, and I wear a small.” The store owner explained that the difference stemmed from the need to hand iron her shirts because his automatic presser was not made to handle small-sized women’s garments. Was this dry cleaner practicing price discrimination?
A dry cleaner in California encountered controversy for charging more to dry clean women’s shirts than men’s shirts. As an unhappy female customer noted, “They charged me $1.50 for each of my husband’s shirts, and he wears an extra large. They charged $3.50 for each of mine, and I wear a small.” The store owner explained that the difference stemmed from the need to hand iron her shirts because his automatic presser was not made to handle small-sized women’s garments. Was this dry cleaner practicing price discrimination?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A dry cleaner in California encountered controversy for charging more to dry clean women’s shirts than men’s shirts. As an unhappy female customer noted, “They charged me $1.50 for each of my husband’s shirts, and he wears an extra large. They charged $3.50 for each of mine, and I wear a small.” The store owner explained that the difference stemmed from the need to hand iron her shirts because his automatic presser was not made to handle small-sized women’s garments. Was this dry cleaner practicing price discrimination ?
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Step 1
Price discrimination refers to the discrimination done by the owner or the producer while charging to the customers.
Here it means we charge different prices to the different for the same product but to different persons or in different scenarios.
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