Practicing Success

Target Exam

CUET

Subject

Entrepreneurship

Chapter

Enterprise marketing

Question:
Assertion: Skimming method can backfire if there are close competitors and they also introduce same products at lower price.
Reasoning: The consumers will think that the company always sells the products at higher prices which will result in consumers abandoning other products of the company also.
Options:
Both Assertion (A) and reasoning (R) are correct and R is the correct explanation of A.
Both Assertion (A) and reasoning (R) are correct and but R is not the correct explanation of A.
Assertion (A) is true but Reasoning (R) is not correct.
Assertion (A) is not true but Reasoning (R) is correct.
Correct Answer:
Both Assertion (A) and reasoning (R) are correct and R is the correct explanation of A.
Explanation:
This method of Skimming can backfire if there are close competitors and they also introduce same products at lower price then consumers will think that the company always sells the products at higher prices which will result in consumers abandoning other products of the company also.