Alex's Knot Shop Prices Its Ties at $5 Intervals from $10

question 245

Multiple Choice

Alex's Knot Shop prices its ties at $5 intervals from $10 to $25 because most customers find these prices appealing and easier to compare. This is:

• A) prestige pricing.
• B) penetration pricing.
• C) price lining.
• D) odd-even pricing.
• E) value in use pricing.

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Definitions:

Cerebral Cortex

The outer layer of the brain that is responsible for complex cognitive processes, including thought, memory, awareness, and consciousness.

Biological Evolution

The process by which different kinds of living organisms are thought to have developed and diversified from earlier forms during the history of the earth.

Low Base Rate Fallacy

The tendency to ignore the base rate (i.e., the prevalence of an event or characteristic within a given population) when making judgments of probabilities, leading to inaccurate assessments.

Rarely Exercised Option

An option or choice that is available but seldom used or selected by people.