A day after US Airways announced its new low fares for the autumn on travel from New York (i.e.,Newark and LaGuardia Airports)to selected cities in the United States and Canada,American Airlines matched their fares.American Airlines is using a _____ strategy.
A) Value pricing
B) Price signaling
C) Demand-based pricing
D) Going-rate pricing
E) Price trimming

Question

Quizplus · Accepted Answer

Price signaling is a strategy where a company adjusts its prices in response to a competitor's pricing actions, as American Airlines did by matching US Airways' fares.

A Day After US Airways Announced Its New Low Fares