A hotel with market power charges customers who check in before 5:00 pm more than those who check in after 5:00 pm. Those who check in early are much more likely to use the hotel's pool
Explain why this price difference may not be price discrimination.
The marginal cost of providing a hotel stay to those who check in early may be greater than the marginal cost of providing a stay to those who check in after 5:00 pm. Those who check in early are more likely to use more towels, soap, shampoo, bathing caps, etc., than those who arrive after 5:00 pm. The difference in costs may explain the hotel price differences.
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A decrease in labor productivity will increase marginal cost
Indicate whether the statement is true or false
Firms in monopolistic competition and oligopoly depend on some degree of brand loyalty. Which goods are able to command the most brand loyalty?
a. facial tissues b. cola drinks c. shampoo d. cigarettes e. toothpaste