A Retailer Can Reward Its Best Customers Through ________

question 14

Multiple Choice

A retailer can reward its best customers through ________.

• A) everyday low pricing
• B) manufacturer-sponsored coupons
• C) customer loyalty programs
• D) contests and sweepstakes

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Definitions:

Substitution Effect

The financial concept stating that when prices increase or incomes drop, individuals will substitute higher-priced goods with more affordable options.

Normal Goods

Goods for which demand increases as the income of consumers increases, and falls when consumer income decreases.

Utils

A hypothetical unit of measurement used in economics to represent the satisfaction or utility that a consumer receives from consuming goods and services.

Substitution Effect

The change in consumption patterns due to a change in relative prices, where consumers replace more expensive items with less costly alternatives.