Question

In: Economics

Mickey Mouse Lets You Ride "for Free" At Disney World Walt Disney World Theme Parks offer...

Mickey Mouse Lets You Ride "for Free" At Disney World

  • Walt Disney World Theme Parks offer visitors a wide variety of ticket choices.
  • The one thing these ticket options have in common is that they entail a fixed entrance fee and allow customers to take as many rides as they want at no additional charge.
  • For instance, by purchasing a 1-Day ticket for about $66, a customer gains unlimited access to the park of her choice for one day.
    • Wouldn't Disney earn higher profits if it charged visitors, say, $11, each time they went on a ride?
  • Remember to research the topic.

Solutions

Expert Solution

* There are total of 46 rides available in Disney World.

* On average 6-10 rides are preferred per person.

If Disney charge visitors, say $11, each time they went on a ride then:-

YES, if we are considering the same average of 6-10 rides if being preferred by per person then the earning per person i.e. $11*6=$66 or $11*10=$110, will give more profit but it may decrease the footfall as for per ride the charges will be variable (per ride $11).

OR

If the park charges for say $66 per person for unlimited access to all the rides then the footfall will increase, which will result in more sales of the Disney world tickets, also the total time spent inside the theme park will increase which will give better scope for high sales of foods/drinks inside the park.


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