Question

Based on the below product strategy how will you price the product?

What factors about the target market and the competition influence your decision?

Answer 1

When determining the price of a product, factors such as market power, product similarity, and barriers to entry should be considered.

Step-by-step explanation:

When pricing a product, it is important to consider factors about the target market and the competition. Here are some steps you can follow to determine the price:

1. Consider the market power of your firm and other firms in the industry. Market power refers to the ability of a firm to influence the price of its product. If your firm has a high market power, you may be able to charge a higher price.
2. Assess the similarity of your product to the products of other firms in the industry. If your product is unique or has distinctive features, you may be able to charge a higher price.
3. Examine the difficulty for new firms to enter the industry. If the industry has high barriers to entry, such as high capital requirements or strong brand loyalty, you may have more flexibility in setting the price.