Which of the following is not a form of deceptive or illegal pricing?

Question

Which of the following is not a form of deceptive or illegal pricing?

BlackTom AI · Accepted Answer

Question focus: identifying which option is not a deceptive or illegal pricing practice.
Option 1: Predatory pricing. This is typically considered illegal in many jurisdictions because a firm deliberately prices below cost to drive out competitors and later raise prices. The reasoning hinges on intent and effect to suppress competition, not on ordinary price competition.
Option 2: Leader pricing. This is a standard retail tactic where a store offers one or more items at a relatively low price to draw customers into the store, with the expectation they will buy other items at regular prices. It is generally legal and common in competitive markets when transparency is maintained and there is no misrepresentation. It is not inherently deceptive.
Option 3: Bait-and-switch tactics. This is widely regarded as deceptive. A retailer advertises a product at an attractive low price to attract customers but has little or no intention of selling it at that price, instead steering the customer to a higher-priced item or pressuring them into buying under misleading premises.
Option 4: Horizontal price fixing. This involves competitors at the same level agreeing on prices, which is illegal in many jurisdictions under antitrust or competition laws due to the reduction in price competition and potential harm to consumers.
Overall, each of the other options describes practices that are either illegal or deceptive in standard regulatory frameworks, whereas leader pricing is a legitimate pricing strategy when used transparently and in good faith.

COMM_V 296 103 104 2025W1 Prep Quiz #12 - Pricing Strategy, Part 2

Which of the following is not a form of deceptive or illegal pricing?

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