The local zoo has a pricing policy in which senior citizens pay a lower price than younger adults.This policy is:
A)a form of perfect price discrimination.
B)a form of third-degree price discrimination.
C)certain to reduce total revenues for the zoo.
D)certain to reduce the number of visitors to the zoo.

Question

Quizplus · Accepted Answer

This policy is an example of third-degree price discrimination where prices are set based on the demographic segment of customers. In this case, senior citizens are being charged a lower price than younger adults. This policy is not a form of perfect price discrimination as it does not allow the zoo to charge each customer their willingness to pay, but instead, it segments the market based on age. It is not certain that this policy will reduce total revenue for the zoo or reduce the number of visitors as it depends on the elasticity of demand for each demographic segment.

The Local Zoo Has a Pricing Policy in Which Senior