EBK ESSENTIALS OF ECONOMICS
7th Edition
ISBN: 8220102452107
Author: Mankiw
Publisher: CENGAGE L
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Chapter 14.4, Problem 4QQ
To determine
The effects of
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Define price discrimination. Give two examples of price discrimination. How does perfect price discrimination affect consumer surplus, producer surplus and total surplus?
How does price discrimination play a role in the economy?How does the idea of price discrimination apply to an industry?
Hersheypark in Pennsylvania mentions the following offer on its Web page: “A military discount is available at Hersheypark during the regular summer operating schedule off of the Regular, Junior and Senior One Day admission. This discount is available to active duty military, reserves, retired military personnel, and members of the National Guard.” This is _____ price discrimination.
Chapter 14 Solutions
EBK ESSENTIALS OF ECONOMICS
Ch. 14.1 - Prob. 1QQCh. 14.2 - Prob. 2QQCh. 14.3 - Prob. 3QQCh. 14.4 - Prob. 4QQCh. 14.5 - Prob. 5QQCh. 14 - Prob. 1QRCh. 14 - Prob. 2QRCh. 14 - Prob. 3QRCh. 14 - Prob. 4QRCh. 14 - Prob. 5QR
Ch. 14 - Prob. 6QRCh. 14 - Prob. 7QRCh. 14 - Prob. 8QRCh. 14 - Prob. 1QCMCCh. 14 - Prob. 2QCMCCh. 14 - Prob. 3QCMCCh. 14 - Prob. 4QCMCCh. 14 - Prob. 5QCMCCh. 14 - Prob. 6QCMCCh. 14 - Prob. 1PACh. 14 - Prob. 2PACh. 14 - Prob. 3PACh. 14 - Prob. 4PACh. 14 - Prob. 5PACh. 14 - Prob. 6PACh. 14 - Prob. 7PACh. 14 - Prob. 8PACh. 14 - Prob. 9PACh. 14 - Prob. 10PACh. 14 - Prob. 11PA
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- Explain the first degree of the price discrimination in the economy?arrow_forwardSome pizza joints charge more for delivered pizza than if customers pick up the pizza at the restaurant. Explain how this might be an example of third-degree price discrimination and provide another explanation for this pricing difference other than price discrimination.arrow_forwardExplain how price discrimination increases profit.arrow_forward
- One example of price discrimination is when movie is newly released the ticket price for movie theater and price of DVD's are very expensive. After some time, the same movie ticket and DVD price become cheaper. Use this example to discuss the benefits and potential negative consequences of a price discrimination pricing strategy.arrow_forwardIn which cases would an organization benefit from using direct and indirect price discrimination? Does market structure influence the capacity of the firm to use price discrimination?arrow_forwardTara loves to go through the Saturday paper and cut out supermarket coupons. How do you think Tara's coupon-clipping habits apply to the concept of price discrimination?arrow_forward
- In which of the following situations'is price discrimination not possible? Marginal Cost of production = Average Total Cost = a %3D %3D constant Demand curve for the firm's output is perfectly elastic Marginal Cost of production is less than the Average total cost of prouction.arrow_forwardAt the beginning of each academic year, Apple company would promote its products like MacBook Pro in universities’ stores by offering discounts to the university staff and students. Explain whether this is an example of price discrimination。arrow_forwardwhat are pricing tactics and examples? What are some forms of price discriminations?arrow_forward
- The firm uses price discrimination to increase its profits. What is the change in the price level? Assume the firm is acting to maximize profits before and after price discrimination. A- From $8 to $14. B-From $14 to $8. C-From $12 to demand level at every output quantity D-From $8 to demand level at every output quantity. E-From $14 to demand level at every output quantityarrow_forwardWhat are the key conditions that must be present for a firm to successfully price discriminate? What are two different examples of price discrimination being practiced today?arrow_forwardBlue INK is the only cabel service provider in Gazipur. The diagram below depicts the price, output and costs incurred by Blue INK. Use the graph to answer the following questions: 1. What is the Total revenue generated by Blue INK at the profit maximizing level of output? 2. If the Cable Service Market turns into a Perfectly Competitive Market, what will be the total ammount of the service provided? 3. If the market turns into a Monopoly market again, what will be the total deadweight loss created?arrow_forward
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