predatory pricing

Cards (4)

  • What is predatory pricing?
    A business lowering their prices so any competitor cannot make a profit and compete
  • What does predatory pricing depend on?
    The strength of a brand and whether they can afford to cut prices
  • Give a benefit of predatory pricing?
    Drives competitors out the market place or discourages new entrants to the market
  • Give a drawback of predatory pricing ?
    Depends on the price elasticity of the product - low elasticity would make a difference to consumer demand