Movie theaters are able to offer discounts to senior citizens because:
a. the elderly deserve lower prices because of their contributions to society.
b. senior citizens have the most inelastic demand.
c. theaters can separate senior citizens from other customers, and it is easier to prevent resale.
d. senior citizens cannot see the movie very well because of poor eyesight.
e. senior citizens are frequent visitors to the movie theaters.
QUESTION 2Patents are currently granted for a period of 20 years in the United States. Do you think that time period is too long or too short? Explain your reasoning.
QUESTION 3Suppose the official gold value of the Brazilian real changes from 527 reals per ounce to 508 reals per ounce. We can then say that:
a. the Brazilian real has depreciated in value as a consequence of free market fluctuations.
b. the Brazilian real has appreciated in value.
c. gold is now more expensive to purchase in Brazil than it was before.
d. the Brazilian real has been devalued.
e. the Brazilian economy is expected to experience rapid inflation.
QUESTION 4Why is bundling of unrelated products, one of which is available in the competitive market, a losing strategy?
QUESTION 5Grocery store coupons, mail-in rebates, senior discounts, and in-state versus out-of-state tuition fees are all examples of:
a. government intervention.
b. price neutrality.
c. arbitrage pricing.
d. price discrimination.
e. illegal business practice.
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