Libra Electronics Has Invented a New Technology to Make Laptops

question 73

Multiple Choice

Libra Electronics has invented a new technology to make laptops that are extremely lightweight and unbreakable. The company is advertising aggressively and wishes to create demand for its new range of laptops. To attract customers, the company has priced the laptops attractively. However, to earn a profit, the company has priced the batteries required for the laptops extremely high. Which of the following is illustrated in this scenario?

• A) Downsizing strategy
• B) Harvest strategy
• C) Razor and blade strategy
• D) Divestment strategy
• E) Switching costs

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Definitions:

External Benefit

A positive effect on a party who did not choose to incur that benefit, often associated with public goods or services.

Public‐spirited

Exhibiting a selfless concern for the well-being of the community and the willingness to act for the public good.

Air Pollution

The presence of substances in the atmosphere that are harmful to the health of humans and other living beings or cause damage to the climate or materials.

Medical Care

Services provided by healthcare professionals to diagnose, treat, or prevent diseases and injuries in individuals.