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Mechanism-Based Explanation
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LSAT
LR.213 Mechanism-Based Explanation
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An online retailer began offering free shipping on all orders. Although it collected less shipping revenue, profit per customer increased. Which explanation most plausibly accounts for the retailer's higher profit after free shipping?
A
Shipping carriers charged the retailer for deliveries.
B
Some customers lived farther away than others.
C
Orders were placed through the retailer's website.
D
The offer induced customers to consolidate purchases into larger orders, reducing packaging and fulfillment cost per item while raising merchandise margin per customer.
E
The retailer displayed the free-shipping policy prominently.
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