The pricing strategy described in your question aligns with the objective of managing for long-run profits. This approach involves pricing products lower initially to gain a larger market share, with the expectation that this will lead to greater profitability in the long term as the firm establishes itself in the market.
If a firm prices its products relatively low compared to the cost to develop, with the prospect of gaining a high market share, it is utilizing which profit-oriented pricing objective?
Multiple choice question.
target return
maximizing current profit
unit volume maximization
managing for long-run profits
1 answer