captive pricing strategies
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Many companies use "captive pricing strategies" with products and its complements. They charge a premium price for a complementary accessory of the main product. For example a razor manufacturer will charge a low price for the razor and recoup its margin (and more) from the sale of blades, which fit the razor. Is it ethical to use such a pricing strategy? Should it be made illegal?
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Solution Summary
Is it ethical to use such a pricing strategy? Should it be made illegal?
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There is nothing illegal about using a captive pricing strategy. While it may unethical if consumers did not know about the price of the accessory, in today's market, most people are very aware what is charged for the accessory and thus should make a ...
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