Loss-Leader Pricing Refers to

question 259

Multiple Choice

Loss-leader pricing refers to

• A)a pricing method where the price the seller charges is below the actual cost to make the product.
• B)setting a low initial price and gradually but consistently increasing that price so as not to antagonize the consumer.
• C)deliberately selling a product below its customary price, not to increase sales, but to attract customers' attention in hopes that they will buy other products as well.
• D)a method of pricing based on a product's tradition, standardized channel of distribution, or other competitive factors.
• E)pricing a product between 8 and 10 percent lower than nationally branded competitive products.

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Definitions:

Difference Threshold

The minimum change in stimulation required to detect a difference between two stimuli, also known as the just noticeable difference (JND).

Heavier Objects

Objects with greater mass or weight compared to other items in their comparison set.

Weber's Law

A principle in psychology stating that the change in a stimulus that will be just noticeable is a constant ratio of the original stimulus.

Afterimage

An afterimage is a visual impression that persists as a negative or positive image on the retina after the stimulus that caused it is no longer present.