Grando plc raised its price due to compliance costs. This is an example of which response?

The situation described, where Grando plc raised its prices specifically due to compliance costs, aligns with the concept of mere compliance. This response occurs when a company adjusts its pricing structure not as a strategy driven by market demand or competition, but instead to meet regulatory requirements or to offset increased costs associated with compliance.

In this case, Grando plc is not trying to lead the market or differentiate itself based on pricing strategies; rather, it is reacting to external pressures that necessitate a price increase to cover the added expenses from compliance regulations. This is a straightforward adjustment reflecting the need to remain compliant with laws or standards, thereby maintaining operational viability without necessarily enhancing value for customers.

The other options imply different strategic intents or market behaviors that do not apply in this context. For instance, market-driven pricing typically involves adjusting prices based on competition and customer willingness to pay, which is not the case here. Price discrimination refers to varying prices for different customers or market segments based on their purchasing behavior, which is also not relevant. Lastly, a cost leadership strategy focuses on reducing costs to offer the lowest prices in the market rather than increasing prices due to compliance costs. Hence, the most appropriate classification for Grando plc's price increase is mere compliance.