A Penetration Pricing Policy Is Most Likely to Be Effective

question 310

Multiple Choice

A penetration pricing policy is most likely to be effective when

• A)lowering the price has only a minor effect on increasing the sales volume and reducing the unit cost.
• B)the high initial price will not attract competitors.
• C)a low initial price discourages competitors from entering the market.
• D)customers interpret the high price as signifying high quality.
• E)enough prospective customers are willing to buy immediately at the high initial price to make these sales profitable.

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Definitions:

Functionalist

A viewpoint in sociology which views society as an intricate system where various components collaborate to foster unity and maintain balance.

Religiosity

The intensity and consistency of practice of a person’s (or group’s) faith.

Nuclear Family

A family unit that consists of two parents (of different sexes or the same sex) and their biological or adopted children, living together as a single household.

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A period of major industrialization that took place during the late 1700s and early 1800s, which transformed economies that had been based on agriculture and handicrafts into economies based on large-scale industry, mechanized manufacturing, and the factory system.