which of the following are considered to be price discrimination? (select all that apply.)\n\ncharging…

which of the following are considered to be price discrimination? (select all that apply.)\n\ncharging schoolchildren half-fare for subway or bus transport.\ncharging less for phone services in one location to drive out a competitor.\ngiving seniors a breakfast discount at the local diner.\nproviding a bulk discount for school supplies to local school districts.

which of the following are considered to be price discrimination? (select all that apply.)\n\ncharging schoolchildren half-fare for subway or bus transport.\ncharging less for phone services in one location to drive out a competitor.\ngiving seniors a breakfast discount at the local diner.\nproviding a bulk discount for school supplies to local school districts.

Answer

Brief Explanations:

Price discrimination occurs when a seller charges different prices to different consumers for the same product or service, where the price difference is not based on differences in the cost of production.

  1. Charging schoolchildren half-fare: This is third-degree price discrimination based on a specific demographic group (age/student status) with different price elasticities of demand.
  2. Charging less for phone services to drive out a competitor: This is a form of geographic price discrimination, often referred to as predatory pricing, where prices vary by location to capture market share.
  3. Giving seniors a breakfast discount: Similar to student discounts, this is third-degree price discrimination targeting a demographic group (senior citizens) likely to have more elastic demand.
  4. Providing a bulk discount: This is second-degree price discrimination, where the price per unit varies based on the quantity purchased rather than the identity of the consumer.

Answer:

  • Charging schoolchildren half-fare for subway or bus transport.
  • Charging less for phone services in one location to drive out a competitor.
  • Giving seniors a breakfast discount at the local diner.
  • Providing a bulk discount for school supplies to local school districts.