Different brands within a company's product line generally have different profit margins higher price lines have higher profit margins. For example, Nike Variety tennis shoes have variable costs of $6 and sell for $24 whereas, Nike Wimbledon tennis shoes have variable costs of $10 and sell for $48. It must be true that:

Different brands within a company's product line generally have different profit margins higher price lines have higher profit margins. For example, Nike Variety tennis shoes have variable costs of $6 and sell for $24 whereas, Nike Wimbledon tennis shoes have variable costs of $10 and sell for $48. It must be true that:

Different brands within a company's product line generally have different profit margins higher price lines have higher profit margins. For example, Nike Variety tennis shoes have variable costs of $6 and sell for $24 whereas, Nike Wimbledon tennis shoes have variable costs of $10 and sell for $48. It must be true that:



A.

demand is unrelated to price.


B.

Nike is using a cost-plus percentage-of-cost pricing strategy.


C.

Nike is using a price lining strategy.


D.

demand is unrelated to product quality.



Answer: C


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