The Coffee Express company is located in a business district with few customers on the weekend.To attract customers on Saturday and Sundays,it reduces its prices on these two days.This is an example of
A) dynamic pricing.
B) the substitution effect.
C) the income effect.
D) the target return effect.
E) cross-price elasticity.

Question

Quizplus · Accepted Answer

The Coffee Express company is using dynamic pricing by reducing its prices on the weekend to attract customers. Dynamic pricing is the strategy of adjusting prices in real-time in response to demand in order to maximize revenue or profit. In this case, Coffee Express is trying to increase its revenue by reducing prices on the weekend when demand is low.

The Coffee Express Company Is Located in a Business District