Which of the following statements about the pricing of services (compared to the pricing of goods) is false?
A)The demand for services tends to be more elastic than the demand for goods.
B)Cost-oriented pricing is more difficult for services.
C)Comparing prices of competitors is more difficult for service consumers.
D)Self-service is a viable competitive alternative.
E)Consumers are less able to stockpile services by taking advantage of discount prices.

Question

Quizplus · Accepted Answer

The statement that the demand for services tends to be more elastic than the demand for goods is actually true. Elasticity of demand refers to how responsive consumers are to changes in price. Services are often more discretionary and can be easily substituted or postponed, thus leading to a more elastic demand.

Which of the Following Statements About the Pricing of Services