Which of the Following Is a Good Example of the Low-Ball

question 220

Multiple Choice

Which of the following is a good example of the low-ball technique?

• A) A car salesman offers to sell you a car for a cheap price, but after reading the fine print, you see that there are many hidden fees and charges.
• B) A prospective buyer offers a low price for your house, hoping that you will reach a favourable compromise price.
• C) A door-to-door salesman asks you for a glass of water before proceeding with his sales pitch.
• D) An antiques dealer offers you a very low price for your grandfather's watch, expecting that you will take the best offer given, regardless of its value.

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Definitions:

Economic Profits

The difference between total revenue and total costs, including both explicit and implicit costs.

Speeding Ticket

A penalty issued by law enforcement to a driver who is found to be exceeding the legal speed limit.

Revenue Per Mile

A metric commonly used in transportation and logistics to assess the income generated for every mile of transport provided, crucial for evaluating efficiency and profitability.

Profit Maximization

This strategy entails making business decisions that increase a firm's profits to its highest potential by evaluating cost structures and price points.