Question

The fact that corporate travelers are less price sensitive than most leisure travelers because the corporation pays for the travel is referred to as the:

A. expenditure effect
B. price-quality effect
C. unique value effect
D. shared cost effect

Answer 1

Answer:

The correct answer is D. shared cost effect

Explanation:

The shared cost effect refers to the reduction in price sensitivity of a customer created through the perception that part of the purchase price is paid for by a third party of the firm itself.