What is third-degree price discrimination?
What will be an ideal response?
In third-degree price discrimination, the seller charges different amounts to different classes of buyers, as in the following cases:
• Customer-segment pricing - Different customer groups pay different prices for the same
product or service. For example, museums often charge a lower admission fee to students and
senior citizens.
• Product-form pricing - Different versions of the product are priced differently, but not
proportionately to their costs.
• Image pricing - Some companies price the same product at two different levels based on image
differences. A perfume manufacturer can put the perfume in one bottle, give it a name and image,
and price it at $10 an ounce. The same perfume in another bottle with a different name
and image and price can sell for $30 an ounce.
• Channel pricing - Coca-Cola carries a different price depending on whether the consumer
purchases it in a fine restaurant, a fast-food restaurant, or a vending machine.
• Location pricing - The same product is priced differently at different locations even though
the cost of offering it at each location is the same. A theater varies its seat prices according to
audience preferences for different locations.
• Time pricing - Prices are varied by season, day, or hour. Public utilities vary energy rates to
commercial users by time of day and weekend versus weekday.
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When distributing reports and proposals electronically, why is it preferable to send documents as PDF files instead of word-processor files?
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To compute departmental operating income, it is necessary to determine the gross profit and the operating expenses of each department
a. True b. False Indicate whether the statement is true or false
Logistics involves the coordination of all organizations that affect a producer's distribution process, while supply chain management involves only the coordination of inbound flow of products and services to a producer
Indicate whether the statement is true or false
Use the cost information below for Sundar Company to determine the cost of goods manufactured during the current year: Direct materials used$19,000 Direct labor used 24,500 Factory overhead 55,100 Beginning work in process inventory 10,700 Ending work in process inventory 11,300
A. $79,000. B. $43,500. C. $98,600. D. $98,000. E. $42,900.