Podcast
Questions and Answers
Which pricing strategy involves pricing a new product only marginally above its unit cost, with the objective of capturing a large part of the market at an early stage?
Which pricing strategy involves pricing a new product only marginally above its unit cost, with the objective of capturing a large part of the market at an early stage?
- Price Skimming
- Promotional Pricing
- Penetration Pricing (correct)
- Mark-up Pricing
What is the major disadvantage of penetration pricing?
What is the major disadvantage of penetration pricing?
- It can be difficult to raise prices later on
- It can lead to a perception that the product is of low quality
- It can prolong the recovery period for research, development, advertising, and promotion costs (correct)
- It can discourage would-be competitors from entering the market
Which pricing strategy involves pricing a product at a range below its unit cost but higher than its unit variable cost?
Which pricing strategy involves pricing a product at a range below its unit cost but higher than its unit variable cost?
- Going Rate Pricing
- Predatory Pricing
- Marginal Pricing (correct)
- Price Lining
Which pricing method is premised on the theory that consumers will perceive products with odd price endings as lower in price than they actually are?
Which pricing method is premised on the theory that consumers will perceive products with odd price endings as lower in price than they actually are?
What is the biggest weakness of the 'Prize Time' pricing strategy?
What is the biggest weakness of the 'Prize Time' pricing strategy?
Which pricing method involves reducing the number of price points on merchandise to as little as possible, in extreme cases to only one price point?
Which pricing method involves reducing the number of price points on merchandise to as little as possible, in extreme cases to only one price point?
What pricing strategy involves reducing the number of price points on merchandise to as little as possible?
What pricing strategy involves reducing the number of price points on merchandise to as little as possible?
Which pricing strategy disregards the unit cost of a product and capitalizes on high value perception or brand reputation?
Which pricing strategy disregards the unit cost of a product and capitalizes on high value perception or brand reputation?
In which pricing strategy is the selling price much higher than the unit cost of the product or service?
In which pricing strategy is the selling price much higher than the unit cost of the product or service?
What pricing strategy involves pricing a product below its unit cost but above its unit variable cost to outmaneuver competition?
What pricing strategy involves pricing a product below its unit cost but above its unit variable cost to outmaneuver competition?
Which pricing strategy justifies not covering all fixed costs by considering them as 'sunk' and focuses on expanding customer base?
Which pricing strategy justifies not covering all fixed costs by considering them as 'sunk' and focuses on expanding customer base?
What type of pricing strategy aims to charge a high initial price and then gradually reduce it over time to attract different customer segments?
What type of pricing strategy aims to charge a high initial price and then gradually reduce it over time to attract different customer segments?
What is the primary purpose of target return pricing?
What is the primary purpose of target return pricing?
Which of the following is a key weakness of target return pricing?
Which of the following is a key weakness of target return pricing?
What is the primary purpose of odd pricing or psychological pricing?
What is the primary purpose of odd pricing or psychological pricing?
What is the key principle behind loss leader pricing?
What is the key principle behind loss leader pricing?
Which of the following pricing strategies is most likely to be used for a new, innovative product with no direct competition?
Which of the following pricing strategies is most likely to be used for a new, innovative product with no direct competition?
Which pricing strategy is most likely to be used by a company to rapidly gain market share in a highly competitive market?
Which pricing strategy is most likely to be used by a company to rapidly gain market share in a highly competitive market?
