Yield management can be described as
A) managing capacity independent of time constraints
B) stabilizing prices so as to offer a best price to all customers
C) maximizing revenue across standardized customer segments
D) enabling fixed capacity businesses to realize optimum revenue, particularly from perishable inventory

Question

Quizplus · Accepted Answer

Yield management is the process of optimizing revenue by adjusting prices and allocation of capacity to different customer segments. It is particularly relevant for businesses with fixed capacity, such as airlines and hotels, that need to sell perishable inventory such as empty seats or unsold hotel rooms. The goal of yield management is to fill up capacity with the most profitable mix of customers, while avoiding overbooking or leaving inventory unsold. Therefore, the best choice is D, which accurately captures the essence of yield management. Choices A, B, and C are incorrect because they do not fully capture the concept of yield management or may be misleading.

Yield Management Can Be Described as