Question

The marketing manager of Raven Golf Club finds that the club can increase its market share and become the industry leader if it slashes membership prices by 50 percent during the first quarter of the year. However, the club cannot achieve its target return on investment if it slashes its membership prices during a quarter. This conflict illustrates: Group of answer choices how pricing operates in an ideal marketplace. the need for trade-offs in pricing objectives. the need to eliminate low-profit products. a lack of competition in the marketplace.

Answer 1

Answer: The need for trade-offs in pricing objectives

Step-by-step explanation:

A trade offs occur when we have to give up one quality or aspect to gain another quality or aspect. The club can increase its market share by decrease its price by 50%, on the other hand the Club will not be able to meet its Target Return on investment in that quarter if it decreases its price by 50%.

This situations presents a Trade off in the Pricing objectives of the Club. The club is in a situation when it can increase market share and become the in industry leader but in pursuing that goal the Club will loose its ability to achieve targeted return on investments.

The Club must now assess which quality between obtaining an increased market share to become a market leader and achieving its quarterly Targeted investment returns.