Which of the following observations concerning introductory price dealing is true?
A) Established competitors usually choose to meet introductory price dealing.
B) They are temporary price cuts to speed new products into a market.
C) They have the same effect as price skimming.
D) They are the same as low penetration prices.
E) The plan is to sustain the price cut for an extended period of time.

Question

Quizplus · Accepted Answer

Introductory price dealing involves temporary price cuts to introduce new products into a market. It is different from price skimming, which involves setting high prices for new products to capture the market's early adopters. It is also different from low penetration prices, which involve setting low prices for new products to quickly gain a large market share. Established competitors may choose to respond to introductory price dealing or wait to see if it is successful before taking action. The goal of introductory price dealing is not to sustain the price cut for an extended period, but rather to generate interest and trial for the new product.

Which of the Following Observations Concerning Introductory Price Dealing Is