Question

Mint-Microprocessors Corp. learned that its biggest competitor dropped prices dramatically in the European market. In response, Mint-Microprocessors decided to do the same in Asia. This resulted in the competitor minimizing its aggressive stance and returning to earlier price points. This is an example of _________ pricing.

Answer 1

Complete Question:

Mint-Microprocessors Corp. learned that its biggest competitor dropped prices dramatically in the European market. In response, Mint-Microprocessors decided to do the same in Asia. This resulted in the competitor minimizing its aggressive stance and returning to earlier price points. This is an example of ________ pricing.

Group of answer choices

A. prescriptive

B. dumping

C. multipoint

D. predatory

E. leader

Answer:

C. Multipoint.

Explanation:

In this scenario, Mint-Microprocessors Corp. learned that its biggest competitor dropped prices dramatically in the European market. In response, Mint-Microprocessors decided to do the same in Asia. This resulted in the competitor minimizing its aggressive stance and returning to earlier price points. This is an example of multipoint pricing.

A Multipoint pricing refers to the situation, where two or more firms compete and a firm's pricing strategy in one market (international trade) basically has an impact on the rival firm's pricing strategy in another market (international trade).