Match the List-I with List-II
LIST I
Pricing StrategiesLIST II
Their ExplanationA. Skimming Price Policy I. Where the nature of the products are non-storable B. Penetration Price Policy II. Where close substitutes of a new product are not available C. Peak Load Pricing Policy III. Exporting goods at a price lower than the domestic price D. Dumping Pricing Policy IV. Substitutes of new products are available
Choose the correct answer from the options given below:
Pricing Strategy Matching Explained
This solution matches different Pricing Strategies (List-I) with their corresponding Explanations (List-II) based on the provided correct answer.
Correct Matches Identified:
- A. Skimming Price Policy matches with II. Where close substitutes of a new product are not available.
- B. Penetration Price Policy matches with IV. Substitutes of new products are available.
- C. Peak Load Pricing Policy matches with I. Where the nature of the products are non-storable.
- D. Dumping Pricing Policy matches with III. Exporting goods at a price lower than the domestic price.
Reasoning for Matches:
A vs II: A Skimming Price Policy involves setting a high initial price. This is feasible when few close substitutes exist, allowing the company to capture value from early adopters willing to pay more due to lack of alternatives.
B vs IV: A Penetration Price Policy uses a low initial price to gain market share quickly. This strategy is effective when substitutes are available, as the low price discourages customers from switching to competitors.
C vs I: Peak Load Pricing charges higher prices during peak demand times and lower prices during off-peak times. This is particularly relevant for non-storable goods or services (like electricity or airline seats) where supply is fixed, and managing demand fluctuations is crucial.
D vs III: Dumping Pricing Policy is defined as selling goods in a foreign market at a price lower than their price in the domestic market.
The correct option, reflecting these pairings (A-II, B-IV, C-I, D-III), is Option D.
Important Questions from Pricing Strategies
Cost plus pricing is considered appropriate for which combination of the following?
(i) Product Tailoring
(ii) Public Utility Pricing
(iii) Refusal Pricing
(iv) Monopoly Pricing
Choose the correct answer from the code given below:
A firm that produces highly substitute goods can adopt which one of the following pricing strategies ?
In penetration pricing a business firm seeks to access deeper market penetration by keeping prices ____________
Which type of retailers involve in comparatively low prices as a major selling point combined with the reduced costs of doing business?
A reduction from the list price that is offered by a seller to buyers in payment for marketing functions the buyers will perform is known as :
