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Selling via the Internet reduces which pricing constraint?

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Final answer:

Selling via the Internet diminishes pricing constraints related to imperfect information, enhancing transparency and enabling markets to better approach equilibrium through clear communication of product quality.

Step-by-step explanation:

Selling via the Internet reduces the pricing constraint associated with imperfect information. The online environment provides a platform for businesses to communicate the quality of their products through detailed descriptions, customer reviews, and comparative pricing. This ability to demonstrate product quality can alleviate buyer skepticism and encourage transactions, even at lower price points. Business-to-business websites further enhance market transparency by allowing buyers and suppliers from around the world to engage, thereby reducing the constraints traditional physical markets impose. Thus, the Internet diminishes the adverse impact of pricing decisions based on perceived quality and helps markets move toward an equilibrium price and quantity.

User Andy Rose
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