When different prices are charged at different times to reduce capacity restraints (e.g.toll charges on the Sydney Harbour bridge are higher during peak hour),this is known as:
A)peak-load pricing
B)price skimming
C)penetration pricing
D)price discrimination

Question

Quizplus · Accepted Answer

Peak-load pricing is the pricing practice of charging different prices for products or services based on different demand levels during different times to deal with capacity constraints or high demand periods. For example, in transportation, toll charges are higher during peak hours to encourage the use of public transportation or reduce congestion. This practice is known as peak-load pricing. Price skimming is a practice where a firm charges a very high price for its new product or service initially but reduces it as time passes. Penetration pricing is a marketing strategy where a company sets a low initial price for a product intending to increase market share. Price discrimination is the practice of charging different prices for similar products or services to different customers, and it is usually considered a negative practice where certain groups or individuals may face unfair treatment.

When Different Prices Are Charged at Different Times to Reduce