Question

The train I take into town charges less to people who ride between 8:00 am and...

  1. The train I take into town charges less to people who ride between 8:00 am and 3:00 pm.
    1. Explain how this would result from price discrimination
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Answer #1

Price discrimination occurs when the same service or good is priced differently to distinct consumers.

Here, the firm is practicing Peak Loading Pricing. During the peak period, riders are charged higher prices for taking the ride, while during the slack period, riders are charged the lower prices.

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