The example of third-degree price discussed (sftdes 280-281) dealt with the situ

Question

The example of third-degree price discussed (sftdes 280-281) dealt with the situation where two different groups of consumers had different demand characteristics One group (seniors) was more senstfrve to the price of a movie ticket than the other group (students) Note we can rephrase the last statement by saying mat the seniors' demand for movie Defeats was more elastic that that of students As a result, the movie theater was able to price discrminate between the two groups The group with the less elastic demand (students) was charged a higher price The movie theater was able to tell one group from the other by checking ID s You are asked to provide a similar example of third-degree price discrimination that wasn t discussed m the textbook or m class Make sure the difference In prices In your example is driven by demand differences between the two groups and not the cost difference?

Explanation / Answer

Airline Tickets

Business People with one day Round Trip and Others

By asking the person whether it is one day round trip or not or business class ticket

others than Business People

Tendency to delay to pay less

Business class

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