GrouponCom Offers Discounts on Products and Services in Specific Cities

question 92

Multiple Choice

Groupon.com offers discounts on products and services in specific cities.The concept of Groupon is that the discount for the product or service can be claimed only if a certain number of people purchase it.Groupon would BEST be described as a:

• A) media sharing site
• B) microblog
• C) social networking site
• D) virtual world
• E) social commerce site

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Definitions:

Advertising Elasticity of Demand

Advertising elasticity of demand quantifies the change in demand for a product as a result of a change in the amount of advertising for that product.

Price Elasticity of Demand

A measure of how much the quantity demanded of a good responds to a change in the price of that good.

Willingness-To-Pay

The maximum amount an individual is ready to spend to purchase a good or service or to avoid something undesirable.

Marginal Cost

The price required to create another unit of a good or service.