When Toyota Introduced Its Scion Line of Cars,the Lowest Priced

question 131

Multiple Choice

When Toyota introduced its Scion line of cars,the lowest priced model was listed for $15,000 while the highest priced model was listed for $21,000,with two or three other list prices in between.Toyota used a __________ pricing approach.

• A) market penetration
• B) zone
• C) price lining
• D) loss leader
• E) noncumulative quantity discount

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Definitions:

Net Cash Flow

The amount of cash generated or spent over a specific period, typically the result of operating, investing, and financing activities.

Present Value

The value today of a future payment, or series of future payments, discounted at some appropriate interest rate.

Earnings Rate

The rate at which an investment or savings account generates income, usually expressed as a percentage of the principal.

Compound Interest

Interest calculated on the initial principal, including all of the accumulated interest from previous periods on a deposit or loan.