Suppose a movie theater determines it can charge different prices to patrons who go to weekday matinees and people who attend evening and weekend shows. The movie theater's goal is to increase total revenue. The price elasticity of demand for weekend and evening patrons is -0.50, and the price elasticity of demand for matinee moviegoers is -2.80. Based on the price elasticity of demand for each group of people, how should the movie theater adjust its prices? Choose one: O A. Raise the price for matinee moviegoers, and keep the price the same for weekend and evening patrons. O B. Lower the price for matinee moviegoers, and raise the price for weekend and evening patrons. O C. Lower the price for matinee moviegoers, and keep the price the same for weekend and evening patrons.

Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter7: Consumer Choice And Elasticity
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Suppose a movie theater determines it can charge different prices to patrons who go to weekday matinees and people who attend
evening and weekend shows. The movie theater's goal is to increase total revenue.
See Hint
The price elasticity of demand for weekend and evening patrons is -0.50, and the price elasticity of demand for matinee moviegoers is
-2.80.
Based on the price elasticity of demand for each group of people, how should the movie theater adjust its prices?
Choose one:
O A. Raise the price for matinee moviegoers, and keep the price the same for weekend and evening patrons.
O B. Lower the price for matinee moviegoers, and raise the price for weekend and evening patrons.
O C. Lower the price for matinee moviegoers, and keep the price the same for weekend and evening patrons.
O D. Raise the price for matinee moviegoers, and lower the price for weekend and evening patrons.
Transcribed Image Text:Suppose a movie theater determines it can charge different prices to patrons who go to weekday matinees and people who attend evening and weekend shows. The movie theater's goal is to increase total revenue. See Hint The price elasticity of demand for weekend and evening patrons is -0.50, and the price elasticity of demand for matinee moviegoers is -2.80. Based on the price elasticity of demand for each group of people, how should the movie theater adjust its prices? Choose one: O A. Raise the price for matinee moviegoers, and keep the price the same for weekend and evening patrons. O B. Lower the price for matinee moviegoers, and raise the price for weekend and evening patrons. O C. Lower the price for matinee moviegoers, and keep the price the same for weekend and evening patrons. O D. Raise the price for matinee moviegoers, and lower the price for weekend and evening patrons.
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