Which of the Following Statements About Penetration Pricing Is True

question 88

Multiple Choice

Which of the following statements about penetration pricing is true?

• A)Penetration pricing is a profit-oriented approach to pricing.
• B)Penetration pricing is a cost-based pricing method.
• C)Penetration pricing encourages competitors to enter a market.
• D)A penetration pricing strategy is more effective in a marketplace with price-sensitive consumers.

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Definitions:

Expenditures

The act of spending funds or money on goods, services, or activities, either for immediate needs or for future benefits.

Product Cycle

The stages through which a product goes from its initial concept phase to development, market introduction, growth, maturity, and eventual decline.

Severe Competition

A market situation where businesses intensely compete with each other for market share and customer loyalty, leading to aggressive pricing strategies and marketing.