In which of the following situations would a penetration pricing strategy be inappropriate?
A) Sales volume of the service is very sensitive to price
B) Economies in unit costs can be achieved by operating at large volumes
C) A service faces threats of strong potential competition very soon after introduction
D) There is no class of buyers willing to pay a higher price to obtain the service
E) The service is a major improvement over past services

Question

Quizplus · Accepted Answer

Penetration pricing is inappropriate when the service is a major improvement over past services because such a service can command a higher price due to its enhanced value and unique features.

In Which of the Following Situations Would a Penetration Pricing