Quiz_167 - 110 - ,.Whichofthe A Atonetime,

Quiz_167 - 110 - ,.Whichofthe A Atonetime,

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110) The Walt Disney Company is in a position to use a two-part tariff by charging for admission andalso charging for rides inside its two theme parks, Disneyland and Disney World. Which of thefollowing statements regarding Disneyʹs pricing strategy is true?A) At one time, fees for admission and rides at both parks were set at their profit-maximizinglevels. Disney has since changed its pricing policy; it uses a cost-plus pricing strategy foradmission and does not charge for rides.B) At one time, customers had to pay for admission and rides at Disneyland and Disney World.Disney has since changed its pricing policy; it earns higher profits by charging for admissionbut not for rides.C) At one time, customers had to pay for admission and rides at Disneyland and Disney World.Disney has since changed its pricing policy; it earns higher profits by charging for rides butnot for admission.D) At one time, admission fees were charged at both parks but all rides were free. Disney hassince changed its pricing policy; it earns higher profits by charging for both admission andrides.Answer: B110)Diff: 2Page Ref: 534-536/534-536Topic: Two-Part TariffLearning Outcome: Micro 14: Discuss production and pricing decisions within monopolies and how publicpolicies affect monopoliesAACSB: Reflective Thinking111) The Walt Disney Company is in a position to use a two-part tariff policy in setting prices foradmission and rides at Disney World. If this strategy resulted in maximum profit, Disney wouldconvert all consumer surplus into profit. Which of the following explains why Disney does notmaximize its profits from admission and rides?
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