Many restaurants offer "early-bird specials" to dinner customers. These specials consist of a significant price reduction on selected menu items purchased before some pre-determined time, e.g., 6 p.m. Is such a practice a form of price discrimination? Justify your answer.
【General guidance】The answer provided below has been developed in a clear step by step manner.Step1/2Answer:-Yes, offering "early-bird specials" to dinner customers is a form of price discrimination.Price discrimination is the practice of charging different prices to different customers for the same product or service. In this case, the restaurant is charging a lower price for selected menu items to customers who order before a pre-determined time. This is discriminatory because customers who arrive after the pre-determined time are charged a higher price for the same items.Explanation:Please refer to solution in this step.Step2/2The restaurant is able to offer lower prices for early-bird specials because they are trying to attract customers during a slower time of day. By offering a discount, they are able to entice cus ... See the full answer