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Which of these is named as a way that firms become cost leaders?
ARaising the price charged to their most loyal buyers
BAdding features that rivals have not yet developed
CWidening the product range to cover every segment
DDesigning products so they are easy to manufacture
Answer & Solution
Correct answer: D. Designing products so they are easy to manufacture
1. Cost leadership is built by attacking cost at several points at once.
2. The named routes are inexpensive raw materials and more efficient plant operations.
3. They also include designing products for ease of manufacture.
4. Controlling overhead costs and avoiding marginal customers complete the list.
5. Raising prices for loyal buyers is a revenue tactic and does not lower cost.
6. Adding features and widening the range both tend to raise cost rather than reduce it.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 11 "Creating Products and Pricing Strategies to Meet Customers' Needs", section 11.2 Creating a Marketing Strategy_
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