CLEP Management

Answer: d - A video game system and cartridges is most likely to be a razor and blades situation. The razor and blades strategy is when a company gives away a product or charges a very low price to create a market for another good. King Gillette piloted this model. In the 1890s, Gillette found his razor blade was worn out from use. Back then, the blade was attached to the handle. Gillette created a razor handle that used inexpensive disposable blades and a business empire on the idea.

Key Takeaway: You must be able to recognize a razor and blades situation. Other examples include Brita water pitchers and filters, or printers and cartridges.