By Offering All Customers the Same Value Proposition, Businesses Run

question 16

Multiple Choice

By offering all customers the same value proposition, businesses run the risk of

• A) customers becoming less price-sensitive.
• B) a competitor entering the market to satisfy unmet needs.
• C) customer segmentation.
• D) providing direction to the sales force.
• E) reducing resources.

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Definitions:

Weak Axiom

A principle in consumer choice theory stating that if a consumer prefers bundle A over bundle B when both are available, then the consumer should not prefer B over A when prices change but A and B remain affordable.

Revealed Preferences

A theory that determines preferences by observing consumer choices and behaviors rather than asking them directly.

Francs

A currency formerly used in France and other countries, replaced by the euro in many areas.

Strong Axiom

Often refers to the strong axiom of revealed preference, which is a more stringent condition than the weak axiom, ensuring choices are consistent across different sets of available options.