Traditional Yield Management Strategies Are Most Profitable When

question 29

Multiple Choice

Traditional yield management strategies are most profitable when:

• A) The service provider has a homogeneous target market
• B) Its target market is not price sensitive
• C) All members of the target market arrive at basically the same time
• D) Those who arrive early or reserve early are more price sensitive than those who reserve or arrive late
• E) All of the target market is equally price sensitive

---

Definitions:

Discount Factor(s)

A numerical factor used to calculate the present value of future cash flows, reflecting the time value of money.

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in equal installments, reflecting the asset’s gradual decrease in value.

Payback Period

The length of time it takes for an investment to recover its initial outlay in terms of profits or savings.

Initial Investment

The initial amount of money spent to start a project or business venture, often covering expenses like equipment and setup costs.