A new soft drink company sells their cola product at $0.25 a bottle in vending machines,rather than the traditional $1.50 per bottle of the same size.This is an example of:
A)skimming pricing.
B)penetration pricing.
C)price lining.
D)odd-even pricing.

Question

Quizplus · Accepted Answer

This is an example of penetration pricing, where a new company enters the market with a low price to attract customers and gain market share. By selling at a much lower price than competitors, the company aims to lure customers away from other brands and encourage trial of their product.

A New Soft Drink Company Sells Their Cola Product at $0.25