Suppose That a Local Gym Can Divide Its Customers into Two

question 81

Multiple Choice

Suppose that a local gym can divide its customers into two groups with different price elasticities of demand.Which of the following is true?

• A) If a local gym uses price discrimination, it will charge the lower price to the group with the most price elastic demand.
• B) If a local gym uses price discrimination, it will charge the higher price to the group with the most price elastic demand.
• C) Although the different groups have different price elasticities of demand, they have the same willingness-to-pay for gym memberships.
• D) Price discrimination will not benefit a local gym.

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Definitions:

Machines

Devices or systems of devices that perform tasks or assist in the performance of tasks, often using mechanical, electrical, or computer-driven components.

Total Cost

Refers to the complete cost incurred in the production of goods or services, including both fixed and variable costs.

Deer

A wild or domestically raised animal with antlers found in various regions, known for its agility and grace.

Plastic

A synthetic material made from a wide range of organic polymers, such as polyethylene and nylon, that can be molded into shape while soft and then set into a rigid or slightly elastic form.