Marketing mix — price
AQA GCSE Business Studies revision on Marketing mix — price. Aligned to the AQA GCSE Business 8132 specification. This bank has 10 practice questions on this topic.
Sample questions (3 of 10)
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Question 1
Which pricing strategy involves setting a low initial price to gain market share quickly?
- A) Price skimming
- B) Penetration pricing
- C) Cost-plus pricing
- D) Competitive pricing
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Answer: Penetration pricing
Businesses use penetration pricing to encourage customers to try a new product by offering it at a lower price than established competitors. Once a significant market share is achieved and brand loyalty is built, the business may gradually increase the price.
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Question 2
A business sells a product for 20 pounds. The variable cost per unit is 12 pounds. What is the contribution per unit?
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Answer: 8
Contribution per unit represents the amount of money remaining from each sale after covering the direct variable costs. In this case, 20 pounds minus 12 pounds equals 8 pounds, which contributes towards paying off fixed costs.
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Question 3
Which strategy involves setting a high price for a new, innovative product to maximise profit before competitors enter?
- A) Psychological pricing
- B) Predatory pricing
- C) Price skimming
- D) Cost-plus pricing
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Answer: Price skimming
This strategy is common in the electronics industry where firms want to recover research and development costs quickly. As the product ages and competition increases, the price is lowered to attract more price-sensitive consumers.
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7 more questions on Marketing mix — price — plus mistakes tracking and spaced repetition across the whole Business Studies spec.