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    Question

    When a bank lowers interest rates after competitors

    reduce theirs, it follows:
    A Cost-plus pricing Correct Answer Incorrect Answer
    B Skimming pricing Correct Answer Incorrect Answer
    C Competitive pricing Correct Answer Incorrect Answer
    D Value-based pricing Correct Answer Incorrect Answer
    E Penetration pricing Correct Answer Incorrect Answer

    Solution

    Competitive pricing sets prices based on competitors’ pricing strategies. Why Other Options Are Incorrect • A: Based on internal cost. • B: High initial price. • D: Based on customer perception. • E: Low price to enter new market. Banking Example: Matching competitor home loan interest rate reductions.

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