Final answer:
The smaller theaters that replaced large Art Deco movie palaces are known as multiplexes, which host multiple theaters within a single complex, offering various films simultaneously.
Step-by-step explanation:
The large number of smaller theaters that replaced the large Art Deco movie palaces are known as multiplexes. Multiplexes are a modern cinema development where a single facility contains multiple separate theaters, each capable of showing a different film simultaneously. This concept emerged as a response to the increasing diversity of films being made, and the desire to offer audiences a variety of cinematic options at a single location, a contrast to the single, grand movie palaces of the past.