Non-Linear Pricing

Non-Linear Pricing

Non-linear pricing is a type of pricing where the price of a good or service is not proportional to the quantity of the good or service that is being purchased. In other words, non-linear pricing means that the price of a good or service changes as the quantity of the good or service changes.

There are two main types of non-linear pricing: bundled pricing and tiered pricing. Bundled pricing is when two or more products are sold together for one price. Tiered pricing is when the price of a product varies depending on how much of the product is being purchased.

Non-linear pricing can be used to increase profits, encourage customers to purchase more, or discourage customers from purchasing too much. Non-linear pricing can also be used to signal quality, segment markets, or change perceptions.