Question detail
SolarSprout serves price-sensitive customers while using retained profit; the case evidence includes break-even output of ?4,360, sales of 395 units, and a 15% change in costs or demand. Which option best applies Explain features and impacts of price skimming, price penetration, competitive pricing, loss leader and cost-plus pricing?
Try the question, check the answer, then read the explanation to understand the curriculum point.
At a glance
MCQ
Type
practice
Style
Topic
The elements of the marketing mix: price, product, promotion and place
Question
- A. Use cost-plus, competitive pricing, loss leader, price skimming to judge capacity utilisation, managers impact, and the business objective in Price.
- B. Give only a definition of The elements of the marketing mix: price, product, promotion and place without using the case evidence.
- C. Treat fixed and variable costs as identical and ignore the effect on managers.
- D. Choose the largest sales figure without checking costs, finance, or context.
Answer
The correct option is: Use cost-plus, competitive pricing, loss leader, price skimming to judge capacity utilisation, managers impact, and the business objective in Price.
Explanation
This option works because Use cost-plus, competitive pricing, loss leader, price skimming to judge capacity utilisation, managers impact, and the business objective in Price. The case evidence gives ?5,860, 395 units, and 15%, so the answer must explain the commercial effect rather than repeat a definition. The distractors are weaker because they confuse fixed and variable costs, miss the managers, or ignore the business objective.
Common mistake
Price common mistake 1
Giving a vague answer instead of directly addressing: Explain features and impacts of price skimming, price penetration, competitive pricing, loss leader and cost-plus pricing..
Answer by clearly explaining how to explain features and impacts of price skimming, price penetration, competitive pricing, loss leader and cost-plus pricing..
Related flashcards
Flashcard 1 of 5
Related practice questions
Question 1 of 5
Choose an answer, get feedback, then move sideways through the set.