Question

"Producers use captive product pricing to set the price of the main product ________ and set ________ on the supplies necessary to use the product."

Answer 1

Answer:

C) low; high markups

Explanation:

Producers use captive product pricing to set the price of the main product low and set high markups on the supplies necessary to use the product."

Low price for main products aims at captivating more consumers (captive product pricing). The producer make profits by increasing the monetary value (high markup) of supplies necessary to use the product. For example, a company may be producing toothbrushes and toothpaste, the company may make the price of the brushes very cheap to captivate consumers and increase the markup (price) of the paste needed to make use of the brushes to make up for any loss incurred from the low price of the brushes.