Healthful Foods, Inc. is launching a new line of vegan and gluten-free products after responding to customers’ feedback. Since the company is a pioneer in specialty foods in its area, it prices these new products with an eye on future competitors through
Explanation
Answer: B - Healthful Foods, Inc. is launching a new line of vegan and gluten-free products after responding to customers’ feedback. Since the company is a pioneer in specialty foods in its area, it prices these new products with an eye on future competitors through new product pricing. New product pricing is a difficult process, which is often done after extensive market research and surveying. With the use of test market data, as well as competitors’ pricing, a company such as Healthful Foods, Inc. can determine the best prices for their new line of products. As an example of new product pricing, the company can employ penetration pricing, which takes into consideration the long-term possibility of competitors entering the market and offering similar products.
