Why would a firm price above competition?
A) Because the firm has a superior product.
B) Because it is a price follower in the industry.
C) Because the firm aims to be a price leader in the industry.
D) Because this approach represents the collective wisdom of the industry.

Question

Quizplus · Accepted Answer

An example of pricing below competition can be found in sealed-bid pricing, in which the firm is bidding directly against competition for project contracts. firm may price above competition because it has a superior product or because the firm is the price leader in the industry.

Why Would a Firm Price Above Competition