The Corporate Travel Segment Is Often Said to Be Relatively

question 131

Multiple Choice

The corporate travel segment is often said to be relatively price insensitive. Which of the following is the MOST LIKELY explanation for price insensitivity in this market segment?

• A) The cost of switching to other travel service providers including airlines and hotels is relatively low.
• B) It is difficult for business executives to compare suppliers and prices.
• C) Travel expenses are relatively small compared to executive salaries.
• D) Some, or all, of executive travel costs are paid by their employers.
• E) All of the above are possible explanations.

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Definitions:

Prepaid Subscriptions

Payments made in advance for subscription-based services, recognized as an asset until the service period has been fulfilled.

Calendar-Year

A one-year period that begins on January 1 and ends on December 31, used as the financial year by many countries and organizations.

Adjustment

A modification made to accounts or financial statements to correct them or to reflect changes in economic circumstances.

Unearned Subscription Revenue

Revenue received in advance for services or goods to be provided in the future, recognized as a liability until delivered.