GENERAL KNOWLEDGE

Detailed explanation-1: -Penetration pricing is a marketing strategy used by businesses to attract customers to a new product or service by offering a lower price during its initial offering. The lower price helps a new product or service penetrate the market and attract customers away from competitors.

Detailed explanation-2: -Which of the following is true about competitive pricing? It is at a medium level, somewhere in between extremes, using competitors’ prices as a starting point, and adjusting from there.

Detailed explanation-3: -Loss Leader and Market Penetration Pricing Strategies Loss Leader pricing is when a retailer intentionally discounts the price of a product (sometimes below cost) in order to generate extra demand and traffic into their store (hoping consumers will purchase additional products on their visit).

Detailed explanation-4: -What advantage is there for a company to offer products at prices below actual market value? Customers are more likely to try the product because they are not risking as much money. Sometimes the cost per unit of a new product will decrease as the total sales increase.