Final answer:
To price discriminate and charge different prices to town residents and tourists for daily parking passes at Holiday Beach can use their registration plates to identify which cars belong to residents and which to tourists. The price charged to town residents can be lower than price charged to tourists, as residents have more alternative options. The price charged to tourists can be higher due to their limited parking alternatives.
Step-by-step explanation:
To price discriminate and charge different prices to town residents and tourists for daily parking passes at Holiday Beach, Holiday Town can use their registration plates to identify which cars belong to residents and which ones belong to tourists. The marginal cost of providing a daily parking pass is constant at $4. With price discrimination, the town can charge a higher price to tourists since they have less alternative options, while offering a lower price to residents.
The price that town residents will be charged for a daily pass can be lower than the price charged to tourists. This is because residents have more flexibility and might have other alternative parking options. By offering a lower price to residents, the town can encourage them to use the parking area and increase their overall revenue. The exact price would depend on the town's pricing strategy and market conditions.
On the other hand, tourists might be charged a higher price for a daily pass. This is because tourists might not have many alternative parking options and are more likely to be willing to pay a higher price to use the beach parking area. Again, the exact price would depend on the town's pricing strategy and market conditions.