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An Article in the Boston Globe Notes That Many Products

Question 24

Multiple Choice

An article in The Boston Globe notes that many products come with a deceptive price structure. Examples include printers that come with a hefty add-on fee in the form of ink cartridges and razors that must be used with specific high-priced blades. All of the following statements could explain why it is rational for firms to use such a pricing scheme except


A) It reduces the need to resort to price competition in the marketplace since customers cannot easily discern the true price of the product.
B) Firms recognize that it's best not to overwhelm customers with too much pricing information.
C) Firms recognize that there are more myopic customers than sophisticated customers and this pricing strategy tends to draw the myopic (short -sighted) customers.
D) Using sneaky pricing schemes makes it more difficult for consumers to compare pricing.

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