Price differentiation attempts to sell
A) different products with different features at the same price.
B) identical products at different times at different prices.
C) products at lower prices, due to economies of scale unintentionally resulting in lower net income for the company.
D) products to customers based on their ability to pay.
E) all products at different prices.

Question

Quizplus · Accepted Answer

Price differentiation refers to selling identical products at different prices, depending on various factors such as time, location, and customer segments. This practice helps companies to increase their profits by charging higher prices from customers who are willing to pay more, while still attracting price-sensitive customers with lower prices. Option A is incorrect as it refers to product differentiation, where companies offer different products with varying features at different prices. Option C is also incorrect as economies of scale do not necessarily result in lower net income for the company. Option D is a form of price discrimination, which may not always be legal or ethical. Option E is too broad and does not provide any specific information about the pricing strategy adopted by the company.

Price Differentiation Attempts to Sell