Charging Different Prices to Maximize Revenue for a Set Amount

question 271

Multiple Choice

Charging different prices to maximize revenue for a set amount of capacity at any given time is referred to as

• A)demand backward pricing
• B)target pricing
• C)yield management pricing
• D)skimming pricing
• E)penetration pricing

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Definitions:

Consumer Surplus

The divergence between what consumers are willing and have the financial capability to pay for a good or service, and what they really pay.

Willingness to Pay

The maximum price at which a consumer will buy a good or service.

Basketball Sneakers

Athletic shoes designed specifically for playing basketball, offering features such as enhanced grip, ankle support, and shock absorption.

Consumer Surplus

The difference between the maximum price consumers are willing to pay and the actual price they do pay.