Predatory pricing is a type of price discrimination that ________.
A) allows prices to be cut to the level of variable costs
B) is required when a company declares bankruptcy so that it can sell its remaining goods quickly
C) is used in the food industry for perishable goods
D) deliberately sets prices very low, sometimes even below costs, to minimize competition

Question

Quizplus · Accepted Answer

Predatory pricing is a strategy used by dominant firms to drive competitors out of the market by deliberately setting very low prices, sometimes even below costs, to minimize competition. This allows the dominant firm to increase its market share and eventually raise prices to recoup the losses incurred during the period of predatory pricing.

Predatory Pricing Is a Type of Price Discrimination That ________