A car maker's strategy of advertising a basic vehicle model with few conveniences and comforts at a low price to entice buyers and then convincing customers to buy higher-priced models with more amenities is an example of which of the following?
A) product line pricing
B) optional product pricing
C) captive product pricing
D) allowance pricing
E) segmented pricing

Question

Quizplus · Accepted Answer

This pricing strategy is called optional product pricing, where a basic model is advertised at a low price, and then customers are enticed to buy higher-priced models with more amenities. The additional amenities are optional and come with an additional cost, hence the name optional product pricing. This strategy is often used in the automobile industry.

A Car Maker's Strategy of Advertising a Basic Vehicle Model