What Results Can Be Expected If Trimar Videos Uses a Price-Skimming

question 120

Multiple Choice

What results can be expected if Trimar Videos uses a price-skimming strategy to price its video equipment?

• A) It may allow the firm to earn a large profit on each unit of sales of the product.
• B) It will generate a lot of trial purchases of the product.
• C) It will generate a lot of consumer interest.
• D) It permits the firm to gain entrance to a market and then later adjust the price to a more realistic figure.
• E) It will result in price-fixing charges by the government.

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Definitions:

Commercial Bank

A financial institution that provides services such as accepting deposits, providing business loans, and offering basic investment products.

Federal Reserve Bank

The central banking system of the United States, responsible for monetary policy, regulation of the banking industry, and maintaining stability of the financial system.

Money Supply

The full total of economic financial assets available at a certain moment in an economy.

Federal Open Market Committees

A branch of the Federal Reserve that oversees the nation's open market operations and sets the federal funds rate, influencing the economy.