A movie theater offers discounted tickets for seniors and students while charging full price to regular adult viewers. How does this pricing strategy exemplify price discrimination, and what is its primary purpose?

Price discrimination is when a business charges different prices to different groups of people for the same product or service. In this case, the movie theater offers lower ticket prices for seniors and students, while regular adult viewers pay the full price. This strategy helps the theater attract more customers from groups that may have less money to spend, like students and seniors, who might not otherwise go to the movies. For example, by offering a discount, a student may decide to see a film they wouldn’t have chosen if they had to pay full price. The primary purpose of this pricing strategy is to maximize overall sales and fill more seats, ensuring that the theater remains profitable while still being accessible to different audiences.