The following table shows the marginal revenues earned by a price discriminating monopolist in two different markets.Table 11.5

-Movie theaters are able to offer discounts to senior citizens because:
A)the elderly deserve lower prices because of their contributions to society.
B)senior citizens have the most inelastic demand.
C)theaters can separate senior citizens from other customers, and it is easier to prevent resale.
D)senior citizens cannot see the movie very well because of poor eyesight.
E)senior citizens are frequent visitors to the movie theaters.

Question

The following table shows the marginal revenues earned by a price discriminating monopolist in two different markets.Table 11.5
 
-Movie theaters are able to offer discounts to senior citizens because:
A)the elderly deserve lower prices because of their contributions to society. 
B)senior citizens have the most inelastic demand. 
C)theaters can separate senior citizens from other customers, and it is easier to prevent resale. 
D)senior citizens cannot see the movie very well because of poor eyesight. 
E)senior citizens are frequent visitors to the movie theaters.

Quizplus · Accepted Answer

Theaters are able to offer discounts to senior citizens because they can separate them from other customers, making it easier to prevent resale. Additionally, senior citizens may have more flexible schedules and be able to attend movies during non-peak hours, which can help theaters fill seats during slower times. It is not necessarily because senior citizens have the most inelastic demand, although this may be a contributing factor. The other options are not valid reasons for offering senior discounts.

The Following Table Shows the Marginal Revenues Earned by a Price