Leonard has opened an ice cream shop and is using a market penetration strategy. He believes that setting his prices low will increase the volume of customers that come through his door. He also believes that as this occurs, his own costs will decrease as he becomes really good at running his business and making the ice cream. This is due to:

Multiple Choice

• seasonal discounts.
• improvement value.
• experience curve effects.
• markdowns.
• price lining.