Larry's Lawn Care allows customers to use a credit card for purchases. Larry pays 4 percent of the sale to the credit card company. To promote more business, Larry decides to offer a lower price to customers paying cash-that price being 3 percent less than the standard list price. Larry is giving his customers

Question

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Larry is offering a discount to customers who pay cash, which is known as a cash discount. This is different from a functional discount, which is given to customers for bulk purchases, or a trade-in allowance, which is given in exchange for old products. A promotional allowance typically involves offering discounts or free products to promote a new product or service, but in this scenario Larry is offering a discount on the existing service. An everyday low price is a pricing strategy where prices are consistently low, but Larry is specifically offering a discount for cash payments, so it does not fit this category.

Larry's Lawn Care Allows Customers to Use a Credit Card