Firms use many different pricing tactics to try to improve their market share. some are perfectly legitimate and can be considered fair pricing practices, whereas others are deceptive or even illegal. prices tend to fluctuate naturally and respond to varying market conditions. although we rarely see firms attempting to control the market in terms of product quality or advertising, they often engage in pricing practices that can unfairly reduce competition or harm consumers directly through fraud and deception. a host of laws and regulations at both the federal and state levels attempts to prevent unfair pricing practices, but some are poorly enforced, and others are difficult to prove. this activity is important because understanding deceptive and illegal pricing can you detect and avoid it. the goal of this activity is to review the types of practices associated with illegal and unethical pricing strategies. read the description of each type of illegal or unethical price strategy. match the pricing strategies to the corresponding descriptions.

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of the three mortgage options that demarco and tanya have to choose from, the balloon payment mortgage would be their best option, over adjustable payment and fixed payment plans.ultimately, the balloon payment plan would save demarco and tanya overall, in interest, would cost less monthly, and they would only have to make these payments for 8 years, opposing to 30 years for adjustable or fixed payment plans. 

overall, demarco and tanya would save $80,811 if they chose balloon payments over fixed payments, and would save $116,711 if they choose balloon payments over adjustable payments. benefits with choosing fixed payments over adjustable payments is that, in the end, the payments will still be $836.30 a month, while with adjustable payments, the initial monthly payments will be $763.38 to $1082.70 a month, ultimately leading to a more costly purchase. benefits with choosing fixed payments over balloon payments are not present. benefits in choosing adjustable payments over is that it has a lower interest rate, and starts with lower monthly payments initially. benefits in choosing adjustable payments over balloon payments include a lower interest rate, and lower initial monthly payments. benefits in choosing balloon payments over fixed payments include lower interest rates, lower overall price, lower monthly payments, takes less time to pay off, and does not require a downpayment. benefits in choosing balloon payments over adjustable payments include, lower monthly payments (when averaged), takes less time to pay off, and lower overall price.

hence, option c, balloon payments, is the best option for demarco and tanya to make this purchase, for it will save them a minimum of $80811, and a maximum of $116,711.