The Maker of Oral-B Toothbrushes Is Introducing a New Electric

question 22

Multiple Choice

The maker of Oral-B toothbrushes is introducing a new electric plaque remover and expects considerable competition. What pricing strategy would be appropriate for this maker to choose?

• A) Price skimming
• B) Penetration pricing
• C) Odd-even pricing
• D) Prestige pricing
• E) Psychological pricing

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Definitions:

Pre-Tax Book Income

The income of a company before taxes are applied, calculated according to accounting standards.

Tax Depreciation

A tax deduction that allows a company to recover the cost of property or assets it has purchased by reducing taxable income.

Book Depreciation

Book depreciation is the portion of the cost of a fixed asset that is written off annually on the financial statements of a company over the useful life of that asset, according to accounting standards.

Tax Rate

The percentage at which an individual or corporation is taxed, which can vary based on income levels, activities, or other factors.