Mercedes Was Able to Successfully Introduce Its C-Class Car at $30,000

question 28

Multiple Choice

Mercedes was able to successfully introduce its C-Class car at $30,000 without injuring its ability to sell other Mercedes cars for $100,000 or more. Mercedes implemented a(n) ________.

• A) downward line stretch
• B) product line contraction
• C) cannibalization strategy
• D) upward line stretch
• E) value stretch

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Definitions:

Opportunity Cost

The cost of forgoing the next best alternative when a decision is made to choose one option over others.

Brownies

A small square-shaped chocolate cake that is typically rich in chocolate flavor and often contains nuts or other additives.

Cookies

Small data files stored on a user's computer by websites, used to remember information about the user's visit.

Comparative Advantage

The ability of an individual or economy to produce goods or services at a lower opportunity cost than others.