Question

At many amusement parks, customers who enter the park after 4 p.m. receive a steep discount on the price they pay. This is a type of price discrimination because the amusement park charges a lower price to

students who can’t visit until after 4 p.m. anyway.

people who have a more inelastic demand for amusement parks.

people who have a more elastic demand for amusement parks.

people with 9-to-5 jobs.

Answer 1

If the amusement parks are charging a lower price after \(4 \mathrm{p} . \mathrm{m} .\), then it means that the amusement park owners know that there are people who have an elastic demand. So, the owner knows that the only way to attract those people is by charging a lower price to them. Usually, the people who wish to visit the amusement parks, no matter what the prices are, visit it in the morning time so that they can stay till evening and take the best out of it. Charging a lower price after 4 P.M. would attract the people who have a lower elasticity as well as will not hinder with those who have an elastic demand. Therefore, the correct answer is option \(\mathrm{C}\).

Therefore, the correct answer is option C: People who have a more elastic demand for amusement parks.

Option A, students who can't visit until after 4 P.M. anyway, is not the correct answer since if students cannot visit until after 4 P.M., it makes their demand inelastic. It means, after 4 P.M., students will be ready to pay even a higher amount and so, charging a lower price will not be beneficial. Therefore, option \(\mathrm{A}\) is incorrect.

If people have an inelastic demand for amusement parks, they will be ready to pay a higher amount for it, and so, charging a lower price from them is not a sane decision. Therefore, option \(\mathrm{B}\) is incorrect.

People who have 9-to- 5 jobs can easily visit the park on weekends or will be ready to visit if after 5, therefore, charging a lower price to them anyway is not beneficial. Therefore, option D is incorrect.

Therefore, the correct answer is option C: People who have a more elastic demand for amusement parks