Predatory Pricing Is a Type of Price Discrimination That ________

question 180

Multiple Choice

Predatory pricing is a type of price discrimination that ________.

• A) allows prices to be cut to the level of variable costs
• B) is required when a company declares bankruptcy so that it can sell its remaining goods quickly
• C) is used in the food industry for perishable goods
• D) deliberately sets prices very low, sometimes even below costs, to minimize competition

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Definitions:

Administrative Expense

Administrative expense refers to the costs associated with the general operation of a business, such as salaries of non-production staff, rent, and utilities.

Finished Goods

Completed products that are ready for sale but have not yet been sold to customers.

Inventory

The goods and materials held by a company for the purpose of resale or production.

Sales

The total amount of revenue generated from selling goods or services over a specific period.