Setting the Price of a New Product Higher Than Expected

question 101

Multiple Choice

Setting the price of a new product higher than expected in order to recover development costs is known as ______.

• A) penetration pricing
• B) price skimming
• C) psychological pricing
• D) price lining

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Definitions:

Expected Payoff

The predicted value of a decision, investment, or gamble, factoring in all possible outcomes and their probabilities.

Probability

A measure of the likelihood that an event will occur, quantified as a number between 0 and 1.

Charity Raffle

A fundraising event where tickets are sold for the opportunity to win prizes, with the proceeds going to support a charitable cause.

Clinical Trials

Research studies conducted with human volunteers designed to evaluate the safety and efficacy of new treatments or interventions.