Penetration pricing means charging a relatively low price for a product as a way to reach the mass market.The low price is designed to capture a large share of a substantial market.Thus,penetration pricing:
A) tends to be more effective in a less price-sensitive market
B) tempts competitors to enter the market
C) provides a large profit per unit sold
D) recoups product development costs quickly
E) tends to lower production costs

Question

Quizplus · Accepted Answer

The low price is designed to capture a large share of the market,resulting in lower production costs.Production costs are lowered because of economies of scale in production.

Penetration Pricing Means Charging a Relatively Low Price for a Product