Answer the following questions using the information below:
Knowledge Transfer Associates is in the process of evaluating its new client services for the business systems consulting division.

-Iowa Utility Company charges its high-usage commercial customers a lower rate per kilowatt-hour than other customers. This is an example of:
A)customer-preference pricing
B)high-load pricing
C)peak-load pricing
D)price discrimination

Question

Answer the following questions using the information below:
Knowledge Transfer Associates is in the process of evaluating its new client services for the business systems consulting division.
 
-Iowa Utility Company charges its high-usage commercial customers a lower rate per kilowatt-hour than other customers. This is an example of:
A)customer-preference pricing 
B)high-load pricing 
C)peak-load pricing 
D)price discrimination

Quizplus · Accepted Answer

Iowa Utility Company is charging different prices to different customer groups based on their level of usage. This is an example of price discrimination, which is a strategy used to increase profits by charging different customers different prices based on their willingness to pay.

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