Question
The National Palace Museum, Taiwan, hosts one of the largest collections of Chinese imperial artifacts and art in the world. In June 2021, the price
The National Palace Museum, Taiwan, hosts one of the largest collections of Chinese imperial artifacts and art in the world. In June 2021, the price of general admission was NT$350, discounted to NT$150 for local citizens and students. Admission was free for all aged 17 and below, local students, and disabled persons. For local seniors, admission was free on weekdays and NT$75 on weekends.
a. Explain how the Museum uses direct segment discrimination. Discuss whether the pricing meets the conditions for such discrimination.
b. Explain how the Museum uses indirect segment discrimination. Discuss whether the pricing meets the conditions for such discrimination.
c. Considering that the marginal cost of admission is congestion, comment on the policy of granting free admission to seniors only on weekdays.
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