Question

Which pricing technique directs companies to set a very low price for their goods to beat the competition?

A. push-out pricing

B. restrictive pricing

C. penetration pricing

D. reverse pricing

Answer 1

Push-out pricing.

Step-by-step explanation:

Push-out pricing is a pricing strategy that involves a firm selling its products at relatively low prices with the aim of forcing out the other competitors out of the market. This pricing strategy is only effective in price sensitive markets.

Additional information:

Penetration pricing is a strategy adopted by a new firm with the aim of gaining entry in a new market. Reverse pricing is a value based pricing model where the customers have more influence on price setting than the firm. Restrictive pricing is a price model whereby price levels are already predetermined.