Imagine that you are the manager of a large clothing company with market power that specializes in selling blue jean pants. 1) Choose two pricing strategies that were discussed in Chapter (Pricing Strategies for Firms with Market Power) that you would implement as the firm manager. 2) Explain how exactly you would implement these two pricing strategies in the real-world Please answer the 2nd part
Customary Pricing
There are various types of pricing strategies followed in the market. They are psychological pricing, odd pricing, free onboard pricing, customary pricing, prestige pricing, dual pricing, ruling pricing, negotiated pricing, mark up pricing, etc. each one can be explained as follows:
Multiple Unit Pricing
“Multiple-unit pricing is a practice where a company offers consumers a lower than unit price if a specified number of units are purchased.”
Imagine that you are the manager of a large clothing company with market power that specializes in selling blue jean pants.
1) Choose two pricing strategies that were discussed in Chapter (Pricing Strategies for Firms with Market Power) that you would implement as the firm manager.
2) Explain how exactly you would implement these two pricing strategies in the real-world
Please answer the 2nd part
Expert Answer
"Since you have asked two questions, we will answer only first question for you. If you have any doubt, then repost the questions separately."
1)
Market Power is the degree to which a firm can influence the price of an item by exercising control over its demand, supply, or both. Pricing strategies are aimed at finding a product’s optimum price, considering the various factors like market objectives, consumer demand, product attributes, price of competitors and market and economic trends.
Firms with market power use different price strategies to maintain their power against the competition. The two pricing strategies that I would implement as the firm manager are :
a) Discrimination Pricing: This is the practice of charging different prices to different customers for the identical goods or services sold by the same supplier. In this
b) Block Pricing: This is a pricing strategy in which identical products are packaged together in order to enhance profits by making the customers to make an all-or-none decision to purchase
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