When a company offers a client a price reduction in return for prompt payment, this is known as:
A) functional discount.
B) cash discount.
C) price discrimination.
D) segmented pricing.
E) psychological pricing.

Question

Quizplus · Accepted Answer

A price reduction offered to a client for prompt payment is known as a cash discount. A functional discount is a reduced price offered to certain customers or distributors based on their role in the supply chain. Price discrimination involves charging different prices to different customers based on their willingness to pay. Segmented pricing involves charging different prices for different versions or levels of a product or service. Psychological pricing involves setting prices that appeal to consumers' emotional responses or perceptions of value.

When a Company Offers a Client a Price Reduction in Return