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There are two important types: static cost-shifting (price discrimination), that is the ability to charge different prices to different customers. The other one is the dynamic cost-shifting , which means charging the maximal amount of money that the customer is able to pay (not necessarily the highest possible value, but the value that people ...
[7] [8] [2] Price discrimination is distinguished from product differentiation by the difference in production cost for the differently priced products involved in the latter strategy. [2] Price discrimination essentially relies on the variation in customers' willingness to pay [8] [2] [4] and in the elasticity of their demand.
The three basic forms of price discrimination are first, second and third degree price discrimination. In first degree price discrimination the company charges the maximum price each customer is willing to pay. The maximum price a consumer is willing to pay for a unit of the good is the reservation price.
Sliding scale fees are variable prices for products, services, or taxes based on a customer's ability to pay. Such fees are thereby reduced for those who have lower incomes, or alternatively, less money to spare after their personal expenses, regardless of income. [1] Sliding scale fees are a form of price discrimination or differential pricing.
Discrimination based on price includes, but is not limited to: increased costs for basic services (health care, repair, etc.) increased costs for per diem charges (such as charging one person $40 while charging another person $100 for exactly the same service provided) [20] not offering deals, sales, rebates, etc. to minorities
Cost-plus pricing is the most basic method of pricing. A store will simply charge consumers the cost required to produce a product plus a predetermined amount of profit. Cost-plus pricing is simple to execute, but it only considers internal information when setting the price and does not factor in external influencers like market reactions, the weather, or changes in consumer va
Business Insider examined dozens of federal trade secrets claims filed by companies over the past decade against current and former employees who also had filed a claim against their employer.
Additional forms of price discrimination include bundling, intrapersonal price discrimination and purchase-history price discrimination. [45] A firm's ability to price discriminate effectively can improve their profitability and/or increase their customer base, but only if the conditions required for price discrimination are met.