An MP3 player is sold at a price close to the break even point,but the accessories for the product are priced at a premium,offer impressive contribution margins.This is an example of:
A)byproduct pricing.
B)bundling.
C)captive-product pricing.
D)multiple-unit pricing.

Question

Quizplus · Accepted Answer

Captive-product pricing involves offering a main product at a low price to attract customers, but pricing essential accessories at a premium to generate profits. This strategy seems to be in line with the scenario given in the question.

An MP3 Player Is Sold at a Price Close to the Break