In an Effort to Differentiate Its Offerings from Its Competitors

question 81

Multiple Choice

In an effort to differentiate its offerings from its competitors, Pegasus Computers decided to add an extra USB port in all its laptops besides providing a free pair of Delphi power bass headphones with every Pegasus laptop. Although the additional features increased the price of the laptops by $500, Pegasus was confident that the strategy would help boost demand for its laptops substantially. This is an example of ________.

• A) good-value pricing
• B) markup pricing
• C) break-even pricing
• D) value-added pricing
• E) cost-based pricing

---

Definitions:

Purchase Price

The amount of money paid or agreed to be paid by the buyer to acquire a good or service from the seller.

Treasury Stock

Stock that has been repurchased by the issuing company, reducing the amount of outstanding stock on the open market.

Sales Price

The amount of money charged for a product or service, or the sum received upon the sale of a product or service.

Paid-In Capital

Funds received from investors in exchange for shares of the company's stock, representing equity financing as opposed to debt.