Certified Supply Chain Professional (CSCP) Practice Exam

How can businesses benefit from the growing market for environmentally safe goods?

1. By reducing operational costs

2. By selling products at a premium price

3. By increasing production volume

4. By decreasing marketing expenditures

The correct answer is: By selling products at a premium price

Businesses can benefit from the growing market for environmentally safe goods by selling products at a premium price. This phenomenon arises from consumers' increasing willingness to pay more for products that are perceived as environmentally friendly or sustainable. Such products often appeal to a niche market that values ethical consumption, and research shows that these consumers prioritize sustainability in their purchasing decisions. Additionally, the premium price can reflect higher production costs due to the use of sustainable materials or processes, but customers are often willing to accept these costs in exchange for the environmental benefits. This allows businesses that effectively market their environmentally safe products to not only capture a larger share of this growing market but also improve their profit margins. While other options may seem plausible in specific contexts, they do not capture the central advantage posed by the premium pricing associated with environmentally safe goods.