Which of the following explains why theater prices for popcorn are three or four times higher than the popcorn price in the grocery store?
A)The grocery store sells a much higher volume and gets its profits that way.
B)The cost of popping the popcorn is high.
C)Grocery stores are satisfied with normal profit while theaters seek economic profit.
D)The demand curve for popcorn in a theater is more inelastic than the demand for popcorn at the grocery store.

Question

Quizplus · Accepted Answer

Theaters can charge higher prices for popcorn because the demand for popcorn in a theater is more inelastic than the demand for popcorn at the grocery store. This means that consumers are willing to pay a higher price for popcorn in a theater setting, allowing theaters to charge higher prices and make a greater profit.

Which of the Following Explains Why Theater Prices for Popcorn