What is NOT TRUE about dynamic pricing?

Question

BlackTom AI · Accepted Answer

The question asks which statement about dynamic pricing is NOT true, so we will evaluate each option’s accuracy.
Option 1: 'Dynamic pricing strategy is adopted by Amazon.com' This is true in practice. Amazon famously adjusts prices in real time or near real time based on demand, inventory, competitor pricing, and other factors, making this statement accurate.
Option 2: 'Dynamic pricing is based on the real-time analysis of changing demands.' This is a core principle of dynamic pricing: prices shift in response to fluctuations in demand to optimize revenue or capacity. This statement is true.
Option 3: 'A company can adopt both dynamic pricing and price discrimination at the same time.' This is plausible and indeed common. Dynamic pricing is a mechanism to charge different prices in response to conditions, and price discrimination is the broader strategy of charging different customers different prices; these can coexist. This statement is true.
Option 4: 'Dynamic pricing is based on the daily stock market.' This is not accurate. While some market factors influence pricing strategies, dynamic pricing primarily relies on demand, supply, time, customer segment, and competitive behavior, not the daily stock market. This statement is false.
Option 5: 'Dynamic pricing is increasingly popular in the digital marketspace.' With online retailers, travel sites, and apps leveraging algorithms to adjust prices in real time, this trend is true. This statement is true.
In summary, the only statement that mischaracterizes the mechanism of dynamic pricing is Option 4, which ties it to the daily stock market rather than to demand-driven and market-responsive pricing. The other statements align with common understanding and applications of dynamic pricing.

What is NOT TRUE about dynamic pricing?

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