Changing the prices of products based on the level of demand characteristics of the customer is called ________ pricing.

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BlackTom AI · Accepted Answer

The question describes adjusting prices based on the level of demand characteristics of the customer, which is a classic description of dynamic pricing.

Dynamic pricing is a strategy where prices fluctuate in response to real-time demand, supply conditions, customer segment, time, or other market factors. This approach aims to capture consumer surplus by aligning price with perceived value or willingness to pay at any given moment.

Since the answer options are not provided, we cannot evaluate alternative theories or terms that might be offered (for example, peak-load pricing, personalized pricing, or price discrimination) against this description. However, understanding the core concept helps: if the price changes in response to demand from the customer or market conditions, it reflects dynamic pricing rather than a fixed or one-size-fits-all price.

If you were given choices, you could compare each term to this definition:
- Dynamic pricing: price varies with demand or customer characteristics in real time.
- Peak-load pricing: price changes based on peak vs off-peak usage, often in capacity-constrained services.
- Personalization or personalized pricing: prices tailored to an individual’s data, preferences, or behavior.
- Price discrimination: charging different prices to different groups or individuals for reasons other than cost, often regulated or market-driven.

In short, the described scenario most closely matches dynamic pricing, where prices respond to demand signals and market conditions rather than remaining constant.

ISA201_D_202610 Final Exam Spring 2025

Changing the prices of products based on the level of demand characteristics of the customer is called ________ pricing.

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