Strategy of Trading Down Involves __________

question 5

Multiple Choice

strategy of trading down involves __________.

• A) adding product features but using lower quality product materials
• B) reducing product features and but using higher quality product materials or ingredients
• C) reducing the number of features, quality, or price of a product
• D) seeking a less price-sensitive target market
• E) changing to a mass merchandiser retailer like Wal-Mart or Target

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Definitions:

Natural Monopoly

A market condition where a single firm can provide a product or service at a lower cost than any potential competitor, often due to economies of scale.

Cost Curve

A graphical representation that shows the cost of producing different quantities of a good or service.

Minimizing Losses

Minimizing Losses involves strategies and actions a business or individual might employ to reduce financial setbacks or decrease the severity of financial downturns.

Total Loss

The complete depletion of value of an asset or the sum of expenses surpassing all revenues, resulting in no net gain.