Recall the Application about the reason for the high price of movie popcorn to answer the following question(s).
-Recall the Application. Suppose a low demander is willing to pay $8 for a movie, while a high demander is willing to pay $12 for a movie and popcorn. If the theater charged $2 for admission and $10 for popcorn, ________ would be willing to go to the movie.
A) only the low demander
B) only the high demander
C) both the low demander and the high demander
D) neither the low demander nor the high demander

Question

Quizplus · Accepted Answer

Both the low demander and the high demander would be willing to go to the movie if the theater charged $2 for admission and $10 for popcorn. The low demander would pay a total of $10 ($8 for admission and $2 for popcorn) which is within their willingness to pay. The high demander would pay a total of $22 ($12 for admission and popcorn) which is also within their willingness to pay. Therefore, the theater would attract both types of customers with this pricing strategy.

Recall the Application About the Reason for the High Price