The Strategy of Charging the Highest Possible Price for a Product

question 188

Multiple Choice

The strategy of charging the highest possible price for a product during the introduction stage of its life-cycle is known as

• A) penetration pricing.
• B) price skimming.
• C) prestige pricing.
• D) sample pricing.
• E) odd pricing.

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Definitions:

Level Of Activity

A measure of the volume of production or operations, often influencing costs and profits in businesses.

Economic Plausibility

The degree to which economic theories or assumptions are realistic and make sense in real-world conditions.

Regression Line

A statistical tool used to describe the relationship between two variables, predicting the value of a dependent variable based on the value of an independent variable.

Volume-Based Cost Driver

A factor that causes the cost of an activity or process to increase or decrease based on the volume of units produced or services rendered.