Free Chegg Answer from TechLaCarte

Domain: IP info
MX-server: IP info
Size: 17738 Bytes
Create: 2020-10-22
Update: 2020-10-22
Score: 0
Safe: Yes

Outbound domains: | | | | |
Welcome to the  family of TechLaCarte, Recently you've asked for Unblur this Chegg Question on our website:

  Please find your Answer below (or) in the attached Image / Document!


Consider dynamic pricing strategies and their impact on profit. Explain why dynamic pricing provides significant profit benefit over (the best) fixed-price strategy as

a. Available capacity decreases.

b. Demand uncertainty increases.

c. Seasonality in demand pattern increases.

Step-by-step solution

  1. Step 1 of 3

    Dynamic pricing strategies

  2. Step 2 of 3

    The dynamic price allows shifting the demand form one period to another period because of change in prices. When the available capacity diminishes, it moves the demands to other periods by change in the price. Companies may increase the price of goods when the demand is more in the market and don’t produce the goods at high demand. The demand of the product comes in regard with the seasonal demand patterns as the demand get increases seasonally with the variability of demand. The price variable is better in such type of scenarios.

  3. Step 3 of 3

    Dynamic pricing strategy gives the profit benefit over the best fixed-price strategy are as follows:

    a) Available capacity decreases.

    They assume everything is equal, the lesser the production capacity and it is relative to average demand, and get the more profit from the dynamic pricing.

    b) Demand uncertainty increases.

    The advantage of dynamic pricing increases when the degree of demand uncertainty is more. It is measure by the coefficient of variation.

    c) Seasonality in demand pattern increases.

    When the demand of season level increases the profit of dynamic pricing also increases.

Was this solution helpful?

 Please consider replying to this email with your Thanks! If you got the answers you requested.

Tip: We usually send the answers as images, texts within the email body, or in the html format (make sure you download the attached file and open with any of the web browsers like Chrome, Firefox to view the solution). 

 🎁 Greetings from,

❤ Don't forget to Like & Follow US on Social Media to support US ❤

Facebook | YouTube | Twitter

We have Successfully Saved your $15!