TravelCheap Inc. is a car rental business that charges customers based on how many miles they put on a car on a daily basis. As result, a person who uses a car to travel from Chicago to Denver during a week is charged much more than a person who uses a car only to travel one mile to the grocery store six times a week.

TravelCheap uses a business model called:

A. freemium.

B. pay-as-you-go.

C. agency.

D. bundling.

B. pay-as-you-go.

Explanation:

Pay-as-you-go business model is one in which the consumer is only charged for what he utilised, the more he uses a product the more he will pay.

This business model provides great satisfaction for the customer because he perceives it as a fair payment system where there is no overcharging for use of a product.

TravelCheap Inc. is using pay-as-you-go. Customers that rent cars for long journeys pay more than those that rent for just a mile drive.