Which of the Following Is a Real-World Example of First-Degree

question 13

Multiple Choice

Which of the following is a real-world example of first-degree price discrimination?

• A) A pizza parlor sells large and small pizzas. Although the large pizzas are twice as big as the small pizzas, they cost less than double the price of a small pizza.
• B) An electric company sells "blocks" of power at different prices. Specifically, any customer who buys more that Q₁ units of electricity can purchase additional units at a lower block price.
• C) Different prices are charged to different customers at a flea market.
• D) A movie theater charges senior citizens a cheaper price for movie tickets than it charges non-senior citizens for the same movie ticket.

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Definitions:

Indifference Curve

A graph showing combinations of two goods that give a consumer equal satisfaction and utility.

Utility

A measure of satisfaction or pleasure that people derive from consuming goods and services.

Cupcakes

Small cakes designed for a single person, often decorated with frosting and other sweet toppings.

Glasses of Milk

Units of measurement for milk, commonly consumed for its nutritional value, including calcium and vitamins.