Limit pricing refers to
A) the fact that a monopoly firm always sets the highest price possible.
B) how the price is determined in a kinked demand curve model of oligopoly.
C) a situation in which a firm might lower its price to keep potential competitors from entering its market.
D) none of the above.

Question

Quizplus · Accepted Answer

Limit pricing is a strategy where a firm sets its prices low enough to deter new entrants from entering the market, as potential competitors may not find it profitable to compete at those price levels.

Limit Pricing Refers to