Quiz_161 - 29 ArnoldMarion,afirst-, . .Wepaid$25each forourseatsi

Quiz_161 - 29 ArnoldMarion,afirst-, . .Wepaid$25each...

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29) Arnold Marion, a first-year economics student at Fazer College, was given an assignment to findan example of price discrimination and present it to his class. When asked for his example ArnoldsaidʺI went to a Milwaukee Brewers baseball game with my cousin last week. We paid $25 eachfor our seats in left field. My aunt and uncle paid $50 each for their tickets; they sat five rowsbehind the first base dugout. This is an example of price discrimination since we paid differentprices for the same product, and the differences were not due to differences in costs.ʺHow wouldArnoldʹs economics instructor assess Arnoldʹs example? A) He would disagree with Arnoldʹs example because the $25 seats and the $50 seats were notthe same products.B) He would agree with Arnold that he had found an example of price discrimination, butwould add that arbitrage would occur if ticket scalpers sold Brewers tickets for more than theprices Arnold and his uncle paid.C) He would agree with Arnold that he had found an example of price discrimination andwould explain that the elasticity of demand for Brewers tickets is different for Arnold and hisuncle.D) He would disagree with Arnoldʹs example because there were differences in transactionscosts for the $50 tickets and the $25 tickets.Answer: A 29) Diff: 2 Page Ref: 523/523 Topic: Price Discrimination Learning Outcome: Micro 14: Discuss production and pricing decisions within monopolies and how public policies affect monopolies AACSB: Reflective Thinking 30) Which of the following isnota requirement for a successful price discrimination strategy? 30) Diff: 2 Page Ref: 523/523 Topic: Price Discrimination Learning Outcome: Micro 14: Discuss production and pricing decisions within monopolies and how public policies affect monopolies AACSB: Reflective Thinking
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