The owner of a neighbourhood hardware store has decided to sell a set of three padlocks for $5. He hopes the below-cost price for the locks will attract current and new customers who will also buy regularly priced items. The owner is encouraging store patronage through which of the following?
A)variable maintenance
B)psychological pricing
C)price maintenance
D)loss leader pricing

Question

Quizplus · Accepted Answer

This is an example of loss leader pricing, where the store offers a product at a price lower than its cost to attract customers who will buy other, regularly priced items.

The Owner of a Neighbourhood Hardware Store Has Decided to Sell