Businesses in the U.S. often compete on price, and competition can be very tough beyond pricing. Competing on price is an accepted practice in the marketplace and under the law. What is the name of the practice that goes beyond fair competition to drive another business out of the market by dropping prices to an extremely low level with the intention of destroying another business?
A) Loss-leader pricing
B) Domestic dumping
C) Predatory pricing
D) Monopolistic pricing

Question

Quizplus · Accepted Answer

Predatory pricing is the strategy of lowering prices to a level that is unsustainable for competitors, with the intention of driving them out of the market. This practice is considered anti-competitive and can be illegal under antitrust laws.