Which of the Following Statements About the Product Life Cycle

question 290

Multiple Choice

Which of the following statements about the product life cycle as a pricing constraint is most accurate?

• A)The newer a product is, the higher the price that can usually be charged.
• B)The later in the product life cycle a product is, the higher the price that can usually be charged.
• C)Once a product is considered nostalgic, the price will continue to rise indefinitely.
• D)Fads will generally have only two price points - high and low - but the values of those price points usually be within 10 percent of each other.
• E)Prices should not be changed until a product reaches its maturity stage

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Definitions:

Economies of Scale

The financial advantages gained by enterprises from their operational size, where the per-unit cost decreases as the operation size increases.

Unit Cost

The cost incurred to produce, manufacture, or acquire one unit of a product or service.

Economic Profits

Profits that exceed both the explicit and implicit costs of a business, including a normal return on investment.

Differentiate Products

The process of distinguishing a product or service from others in the market to make it more attractive to a particular target market.