Exercise 3.2

Ethics and Pricing Decisions
LowCostDrugs.com is an online drugstore. Recently, the company used a computer program to analyze the purchase behavior of customers sorted by zip code and found that customers in some zip codes are, on average, less price-sensitive than the customers in other zip codes. Accordingly, the company has raised prices by 3 percent for the customers in the less-price-sensitive zip codes. Note that zip code is automatically identified when a customer comes to the company's Web site.

Based on this information, answer the following question:
Is it ethical, for LowCostDrugs.com to charge some customers a higher price based on its analysis of prior purchasing behavior? Substantiate your response with appropriate references from the textbook.

Submission Requirements:

• Submit your answer in a Microsoft Word document in 500 words.

Evaluation Criteria:
The exercise rubric will be used to evaluate your responses