If local Shell gasoline stations look at BP stations' prices as the primary method of determining its own prices, Shell is using
A) price fixing, which considers competition to be less important than costs.
B) price fixing, which considers costs to be less important than competitor's prices.
C) market share pricing, which considers competition to be the ultimate pricing goal.
D) competition-based pricing, which considers profit to be the ultimate pricing goal.
E) competition-based pricing, which considers costs to be less important than competitor's prices.

Question

Quizplus · Accepted Answer

Competition-based pricing strategy involves setting prices based on competitors' strategies, prices, costs, and market offerings. In this scenario, Shell is using competition-based pricing by primarily looking at BP stations' prices to determine its own, indicating that it considers competitors' prices more important than its own costs.

If Local Shell Gasoline Stations Look at BP Stations' Prices