As the number of tourists in a village increases during Christmas, the hotels in the locality temporarily increase the rates of accommodation to make profit.This is an example of:
A)price skimming.
B)external reference pricing.
C)high/low pricing.
D)market penetration pricing.
E)odd pricing.

Question

Quizplus · Accepted Answer

This scenario fits the definition of high/low pricing, where the prices are temporarily increased to take advantage of increased demand during a certain time of year (Christmas). Price skimming involves starting with a high price for a new product and gradually lowering it, external reference pricing involves setting prices based on competitors, market penetration pricing involves setting low initial prices to enter a new market, and odd pricing involves pricing items at odd numbers (e.g. $4.99 instead of $5.00).

As the Number of Tourists in a Village Increases During