Question

Cingular​ Cell, Inc. charges its customers a high contract termination fee if they cancel their cell phone contract before the expiration date. The termination fee is an example of a​ ________. A. customer service penalty B. loyalty cost C. customer retention fee D. customer service fee E. switching cost

Answer 1

Answer: Switching cost

Explanation:The cost incurred by consumers while switching from one product to another or from one brand to another is called switching cost. Generally it is monetary but could also be psychological or effort and time based.

In the given case, the company is charging its customers if they cancel their contract earlier. Such cancellation means they are switching to some other company.

Thus, we can conclude that the correct option is E.