Which of the Following Is Not an Example of Pricing

question 135

Multiple Choice

Which of the following is not an example of pricing based on group differences in elasticity of demand?

• A)senior-citizen discounts at restaurants and motels
• B)cash rebates for purchases of automobiles
• C)child discounts for admission to theme parks
• D)discounted student prices for visits to museums

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Definitions:

Optimal Allocation

The most efficient distribution of resources within an economy to maximize the output or welfare.

MB = MC

A principle in economics indicating the optimal level of output or consumption, where the marginal benefit (MB) equals the marginal cost (MC).

Marginal Benefit

The added utility or pleasure that comes from the consumption of one more unit of a good or service.

Marginal Cost

The escalation in aggregate cost linked to the fabrication of an extra item of a good or service.