Asked by Matthew Vulku on May 23, 2024
Verified
A firm has two products that must be used together.The firm sells one of the items at a very low price and profits from the sale of the second,high margin item.The firm is most likely using the ________ pricing strategy.
A) cross subsidy
B) market skimming
C) product positioning
D) market penetration
Cross Subsidy
A pricing strategy where the revenue or profits from one product or service are used to support another within the same company, often to gain competitive advantage.
High Margin
Refers to products or services that yield a significantly greater profit relative to their cost.
Market Skimming
A pricing strategy involving setting high prices initially to target customers willing to pay more before lowering prices to attract a broader market.
- Comprehend the critical role of pricing tactics including cross-subsidy and penetration pricing in enhancing product uptake and broadening market presence.
Verified Answer
Learning Objectives
- Comprehend the critical role of pricing tactics including cross-subsidy and penetration pricing in enhancing product uptake and broadening market presence.
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