Refer to the scenario below to answer the following question(s).
Champion, Inc. is a manufacturer of lunch boxes, school bags, and school stationery. Charles Payton, the CEO of Champion, hopes to sell the products at a low price to penetrate the market quickly.
-Which of the following best supports a market-penetration strategy for Champion?
A) Production costs increase as sales volume increases.
B) It is very difficult for competitors to enter the market.
C) The cost of producing a smaller volume is negligible.
D) The quality of the products supports high initial prices.
E) The market for the products is highly price sensitive.

Question

Quizplus · Accepted Answer

A market-penetration strategy involves selling products at a low price to achieve a high volume of sales and gain market share quickly. This strategy is most effective in a market where the demand is highly price sensitive, as customers are more likely to purchase the product if it is priced lower than competitors. Therefore, option E best supports a market-penetration strategy for Champion.

Refer to the Scenario Below to Answer the Following Question(s)