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Management · Q177

Strategic Management

Graduate and Post Graduate · Management · question 177

Q177

The goal of the cost leader is to:

A.
start a price war
B.
minimize wages
C.
charge the lowest price
D.
make high margins
Answer

Answer: Option D

Solution

Answer: Option D
Solution:
The goal of the cost leader is to make high margins. Leader pricing is a common pricing strategy used by retailers to attract customers. It involves setting lower price points and reducing typical profit margins to introduce brands or stimulate interest in the business as a whole or a particular product line. Products sold in this strategy are often sold at a loss.