Asked by Shreyans Nanavati on Jun 24, 2024
Verified
A local theater charges $5.00 for every matinee (daytime) ticket, but the ticket prices are much higher during the evening. This is an example of:
A) peak-load pricing.
B) second-degree price discrimination.
C) a two-part tariff.
D) bundling.
E) none of the above
Peak-Load Pricing
Practice of charging higher prices during peak periods when capacity constraints cause marginal costs to be high.
Two-Part Tariff
Form of pricing in which consumers are charged both an entry and a usage fee.
Bundling
A marketing strategy that involves offering several products or services for sale as one combined product or service package.
- Comprehend the profitability and conditions for peak-load pricing.
Verified Answer
HR
Hector RodriguezJun 25, 2024
Final Answer :
A
Explanation :
Peak-load pricing involves charging different prices depending on when the service is used, with higher prices during times of high demand and lower prices during times of low demand. The fact that the theater charges a lower price for matinee tickets indicates that they are using peak-load pricing.
Learning Objectives
- Comprehend the profitability and conditions for peak-load pricing.