Pricing Is a Highly Visible Component of a Firm's Marketing

question 118

Multiple Choice

Pricing is a highly visible component of a firm's marketing mix and an easy tool for obtaining a differential advantage over competitors. However, when competitors continually undercut each other to gain that advantage, it can lead to a price war that damages all companies involved. When firms have identical or very similar products and price information is readily available - for example, Coca-Cola and Pepsi - a common pricing approach to avoid price wars is:

• A) competitive-parity pricing.
• B) market-based pricing.
• C) commodity pricing.
• D) bargain pricing.

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Definitions:

Scan

To look over or examine carefully and systematically, often to obtain specific information.

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Prominent Retail Store

A well-known and widely recognized retail establishment that stands out due to its size, location, or reputation.