A Las Vegas theater offers a free performance.There is a two-drink minimum.This is an example of what strategy?
A)value-based pricing
B)cross subsidies
C)multiparty
D)utility and usage

Question

Quizplus · Accepted Answer

This is an example of cross subsidies, as the theater is offering a free performance but requiring customers to purchase a minimum of two drinks in order to make up for the cost of the performance. The drinks are subsidizing the free performance. It is not value-based pricing because the price is not based on the perceived value of the performance, nor is it utility and usage or multiparty.

A Las Vegas Theater Offers a Free Performance