Pricing the Basic Product in a Product Line Low While

question 137

Multiple Choice

Pricing the basic product in a product line low while pricing related items at a higher level is called

• A) premium pricing.
• B) bait pricing.
• C) captive pricing.
• D) price skimming.
• E) price lining.

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Definitions:

Working Capital

The difference between a company's current assets and current liabilities, indicating the liquidity available to run its day-to-day operations.

Current Liabilities

Obligations that are due within one year or within the normal operating cycle of the business, whichever is longer.

Days' Sales In Inventory

Days' Sales in Inventory is a financial ratio that indicates the average time in days that a company takes to turn its inventory into sales.

Sales On Account

Transactions where goods or services are sold and payment is to be made at a later date, often recorded as accounts receivable.