Penetration pricing makes the most sense in situations where a significant group of potential customers are willing to pay a premium price for the good.

Question

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Penetration pricing is a strategy where a product is priced lower than its competitors to enter the market and gain market share. It is most suitable in situations where there is low brand loyalty, high competition, and customers are price-sensitive. Therefore, penetration pricing is not meant for situations where customers are willing to pay a premium price for the good.

Penetration Pricing Makes the Most Sense in Situations Where a Significant