If firms price their products too low,it may
A) result in lower costs.
B) create a premium pricing effect.
C) increase contribution per unit.
D) result in inelastic demand.
E) signal poor quality.

Question

Quizplus · Accepted Answer

If firms price their products too low, it may signal poor quality to consumers. Pricing products too low can create an impression that the product is of inferior quality or a knock-off brand. This may lead to consumers avoiding the product altogether, resulting in lost sales.

If Firms Price Their Products Too Low,it May