42.Which of the following is NOT a reason for increasing prices? A. Cost pressures. B. Curbing demand C. Price comparison. D. Price war
Question
42. Which of the following is NOT a reason for increasing prices?
A. Cost pressures.
B. Curbing demand
C. Price comparison.
D. Price war
Solution
The correct answer is D. Price war.
Here's why:
A. Cost pressures: This is a reason for increasing prices. If the cost of production or raw materials increases, a company may need to increase their prices to maintain their profit margins.
B. Curbing demand: This is also a reason for increasing prices. If demand for a product is too high and the company cannot keep up with production, they may increase prices to slow down demand.
C. Price comparison: This can be a reason for increasing prices. If a company sees that their competitors are charging more for a similar product, they may decide to increase their prices to match or exceed those of their competitors.
D. Price war: This is NOT a reason for increasing prices. A price war involves companies lowering their prices in an attempt to undercut their competitors and gain more market share. It does not involve increasing prices.
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