When Companies Are Setting Prices in Different Countries, the Problem

question 144

Multiple Choice

When companies are setting prices in different countries, the problem with setting a market-based price in each country is that ________.

• A) it allows intermediaries in low-price countries to reship their products to high-price countries
• B) the company would earn the same profits everywhere, regardless of the cost structure
• C) this strategy might price the product out of the market in countries where costs are high
• D) this strategy would make the price too high in poor countries and not high enough in rich countries
• E) it prevents the company from differentiating its products

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Definitions:

Metaphysical Environment

A concept referring to an abstract, non-physical realm that might encompass ideas, spiritual forces, or other non-material influences on reality.

Physical Environment

The surrounding conditions and physical factors, including geography, climate, and built environments, in which individuals or populations live.

Unconscious Environment

Influences from one's surroundings that affect behavior and decision-making processes without one's explicit awareness.

Social Environment

The immediate physical and social setting in which people live or in which something happens or develops.