Retail stores often use in-store shelf-tags that alert shoppers to price savings by posting a product's "original" price next to its "sale" price. Why would firms do this? O It is done to remind consumers that the price reduction is a cash discount. O It is done for inventory purposes. When conducting end-of-year inventorying, the retailer can easily recall the price the product sold throughout the year. O It is a form of "bait-n-switch" advertising, designed to encourage consumers to buy a more expensive product alternative than the one on sale. O It helps establish an internal reference price for consumers. Because it is required by law. The U.S. government requires retailers to state the original price in all of its in-store price promotions.
Retail stores often use in-store shelf-tags that alert shoppers to price savings by posting a product's "original" price next to its "sale" price. Why would firms do this? O It is done to remind consumers that the price reduction is a cash discount. O It is done for inventory purposes. When conducting end-of-year inventorying, the retailer can easily recall the price the product sold throughout the year. O It is a form of "bait-n-switch" advertising, designed to encourage consumers to buy a more expensive product alternative than the one on sale. O It helps establish an internal reference price for consumers. Because it is required by law. The U.S. government requires retailers to state the original price in all of its in-store price promotions.
Chapter20: Setting Prices
Section: Chapter Questions
Problem 7DRQ
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Transcribed Image Text:Retail stores often use in-store shelf-tags that alert shoppers to price savings by posting a product's "original" price next to its "sale" price. Why would firms do this?
O It is done to remind consumers that the price reduction is a cash discount.
O It is done for inventory purposes. When conducting end-of-year inventorying, the retailer can easily recall the price the product sold throughout the year.
O It is a form of "bait-n-switch" advertising, designed to encourage consumers to buy a more expensive product alternative than the one on sale.
O It helps establish an internal reference price for consumers.
O Because it is required by law. The U.S. government requires retailers to state the original price in all of its in-store price promotions.
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