Suppose that General Motors Corporation prices its new automobiles in such a manner that it would achieve a 15 percent return on its investment in these automobiles.Which of the following pricing policies is the company using?

Question

Quizplus · Accepted Answer

General Motors Corporation is using target-return pricing, as they are pricing their new automobiles to achieve a specific return on investment (in this case, 15 percent). A) Odd pricing refers to setting prices slightly below a round number (e.g. $9.99 instead of $10.00) to create a perception of a lower price. B) Price lining involves offering different products at different price points (e.g. a basic model, a mid-level model, and a high-end model). C) Functional pricing involves setting prices based on the product's functions or features.

Suppose That General Motors Corporation Prices Its New Automobiles in Such