Firms engage in an activity called “forward pricing” when they establish, during the early stages of the learning-curve, a price for their products that is lower than their actual costs, in anticipation of lower costs later on, after significant learning has occurred. Under what conditions, if any, does forward pricing make sense?
Answer to relevant QuestionsWhen firms do engage in “forward pricing,” what risks, if any, do they face? Product features are often the focus of product differentiation efforts. Yet product features are among the easiest-to-imitate bases of product differentiation and thus among the least likely bases of product differentiation ...Some firms have engaged in backward vertical integration strategies in order to appropriate the economic profits that would have been earned by suppliers selling to them. How is this motivation for backward vertical ...Which of the following two firms is more vertically integrated? How can you tell? a. Firm A has included manufacturing, sales, finance, and human resources within its boundaries and has outsourced legal and customer ...Visit the corporate websites for the following firms. How would you characterize the corporate strategies of these companies? Are they following a strategy of limited diversification, related diversification, or unrelated ...
Post your question