Question

When Nintendo sets a relatively low price on game units to stimulate more demand for its game cartridges, it is using

A) complementary product pricing.

B) product-bundle pricing.

C) price lining.

D) bait pricing.

E) cost-plus pricing.

Answer 1

Letter A is correct. Complementary product pricing.

Step-by-step explanation:

Organizations use the strategy of adopting a complementary product pricing to increase the total profit of a product group.

This strategy is used when the company sells products that are complementary, ie the use of one is complemented by the use of the other, so the company substantially decreases the price of a product, usually just to cover costs, and guarantees gains from a product with a high price and very high profit margin.

The benefits added to the complementary price of a product are market gain, competitors' entry barriers and retention and attraction of new consumers.