Practice question · Multiple choice
Why can a cinema profitably charge students less than adults for the same seat?
Hints
- Price discrimination needs two things: different willingness to pay, and…
- What stops an adult from using a student ticket? The ID check at the door.
Show the answer
A. Students will pay less and cannot resell
Why
Discrimination works when segments differ in willingness to pay and arbitrage between them is blocked (the student ID). The seat costs the cinema the same either way.
Practise Pricing Strategies
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More questions on Pricing Strategies
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- Sort each real-world price into its strategy.
- Match each pricing method to the condition where it shines.
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- Which are genuine weaknesses of pure cost-plus pricing?
- Versioning sells a cut-down product alongside a full one, sometimes by disabling features already built. Why…