The Product Strategy in Which Companies First Determine the Price

question 183

Multiple Choice

The product strategy in which companies first determine the price at which they can sell a new product and then design a product that can be produced at a low enough cost to provide an adequate profit margin is referred to as:

• A) discriminatory pricing
• B) full costing
• C) target costing
• D) predatory pricing

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Definitions:

Comparative Advantage

The ability of an entity to produce a good or service at a lower opportunity cost than another entity, leading to more efficient trade.

Radios

Devices used for the wireless transmission and reception of sound through electromagnetic waves.

Televisions

Electronic devices designed for the reception and display of audiovisual content through terrestrial, satellite, cable, or internet sources.

Comparative Advantage

The ability of an individual, firm, or country to produce a good or service at a lower opportunity cost than competitors, leading to specialized trade benefits.