When a firm pursues a predatory pricing strategy, it does so
A) to hire more staff to lower unemployment.
B) to increase supply to benefit consumers.
C) to maximize profits in the long run.
D) to discourage short run competition.

Question

Quizplus · Accepted Answer

Predatory pricing involves setting prices low to eliminate competition, with the aim of raising prices and maximizing profits in the long run once competitors are driven out.

When a Firm Pursues a Predatory Pricing Strategy, It Does