__________ model is designed to bring prices down by increasing the number of…
2014
__________ model is designed to bring prices down by increasing the number of customers who buy a particular product at once.
Answer: D. Demand-Sensitive Pricing — Answer: Demand-Sensitive Pricing Why this is correct: The model links price to demand or volume so that unit price falls when more customers buy at once.…
- A.
Economic Order Quantity
- B.
Inventory
- C.
Data Mining
- D.
Demand-Sensitive Pricing
Attempted by 41 students.
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Correct answer: D
Answer: Demand-Sensitive Pricing
Why this is correct:
The model links price to demand or volume so that unit price falls when more customers buy at once.
Common implementations include bulk discounts, group-buy offers, and tiered pricing that reward larger purchases.
The economic rationale is economies of scale and spreading fixed costs over a larger number of units.
Why the other choices are not correct:
Economic Order Quantity: This is an inventory/order-size formula to minimize ordering and holding costs, not a pricing strategy.
Inventory: Refers to stock of goods; it is not a model for setting prices based on buyer volume.
Data Mining: An analytical technique for discovering patterns in data; it does not itself describe a pricing mechanism that lowers prices by increasing buyers.
Study tip: When a question mentions reducing price by increasing the number of customers or purchase volume, look for pricing strategies such as demand-sensitive, volume-based, or group-buy pricing rather than inventory formulas or analytical techniques.