The Gillette Fusion razor sells for approximately $10.00, and a four-set of replacement blades sells for over $8. Which of the following statements is TRUE?
I. Consumers with a high willingness to pay for being clean-shaven will buy many replacement blades.
II. Consumers with a low willingness to pay for being clean-shaven will rarely buy replacement blades.
III. Gillette's high price for the replacement blades is a method to extract consumer surplus from those consumers with a high desire to be clean-shaven.
A) I and II only
B) II and III only
C) III only
D) I, II, and III

Question

Quizplus · Accepted Answer

Consumers with a high willingness to pay will buy more replacement blades, while those with a low willingness will buy fewer. Gillette's pricing strategy aims to extract consumer surplus from those who highly value being clean-shaven.

The Gillette Fusion Razor Sells for Approximately $10