A Penetration Strategy Tends to Be Effective in a Price-Sensitive

question 158

Multiple Choice

A penetration strategy tends to be effective in a price-sensitive market.Thus,one of the purposes of penetration pricing is to do which of the following?

• A) recoup product development costs quickly
• B) discourage competitors from entering the market
• C) produce a large margin of profit per unit
• D) attract the price-insensitive buyer who demands the latest in technology

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Definitions:

Student Loans

Borrowed money that is used to pay for higher education expenses, which must be repaid with interest.

Compounded Monthly

A method where interest earnings are calculated and added to the principal sum each month, leading to increased interest in the next period.

Mortgage Loan

A loan secured by real property through the use of a mortgage note.

Savings Account

A financial account at a bank or similar institution that ensures the security of the original sum while yielding a slight return in interest.