Crimpson Corp.,a California-based company is selling its products for $23.Its average variable costs is $21 and the average selling price of its competitors is $26.This is an example of ________.

Question

Quizplus · Accepted Answer

The situation described is an example of predatory pricing. The company is selling its products below average variable cost, with the intention of driving its competitors out of business. The average selling price of competitors being higher than the company's selling price, further supports the predatory pricing strategy.