Describe the downward demand spiral and its implications for pricing decisions.

Q: What are the optimal prices and profits for pure bundling.

A: Financial Management: Financial management comprises of two words i.e. Finance and management.…

Q: how does the contribution margin pricing method differ from ratio pricing method?

A: The question is based on the concept of pricing policy and methods. The product's price can be…

Q: Define the term price-takers.

A: Price takers is the term used for individual or a company which cannot influence the price of a…

Q: Define sales volume variance.

A: Sales volume variance (also known as sales quantity variance) occurs when the actual quantity of…

Q: What are the calculation formulas for transfer pricing?

A: There are many methods for determining the transfer price. Most businesses actually set the transfer…

Q: what is price elasticity

A: Explaination:-   The price elasticity of desire is an economic statistic that measures the idea of…

Q: Explain the difference between price-takers and price-setters.

A: When a company cannot dictate prices then it is known as price taker. On the contrary, when a…

Q: What is cost-plus pricing? Who uses it?

A:

Q: What is a price standard?

A: Variance: Variance refers to the difference level in the actual cost incurred and standard cost. The…

Q: Explain the goal of yield management

A: Yield management is a kind of pricing strategy.It is based on the understanding of the behavior of…

Q: Present and Explain the theories of the Yield Curve?

A: The yield curve is a curve that shows the relationship between the interest rates and the different…

Q: Arbitrage pricing theory is model developed to be used by:

A: Arbitrage is the practice of taking positive expected return from overvalued or undervalued…

Q: Briefly explain the concept of economic, profitmaximizing pricing. It may be helpful to use graphs…

A: Pricing decisions: Pricing decisions is one of the most important and required decision for the…

Q: b. What i

A: Given as,

Q: When should special pricing orders be accepted?

A: Special pricing order: A special order is a unique one time order made by a customer. In this order…

Q: What is the sales price variance?

A: Sales Price Variance is the variance in total revenue due to different selling price from the…

Q: Distinguish between market-skimming pricing and market-penetration pricing.

A: Product pricing strategies: There are two product pricing strategies of a company. They are,…

Q: Why do proponents of variable costing prefer variable costing when making pricing decisions?

A: Definition:   Variable costing: It refers to the method of product costing in which the price of the…

Q: Discuss the decisions companies face when initiating price increases.

A: Price changing decision is a part of management decision making where they decide the appropriate…

Q: Describe three limitations of the economic, profitmaximizing model of pricing.

A: Profit maximizing price: The price for which the relative quantity is identified by the intersection…

Q: Explain in your own words how increasing Price-to-Book ratio could affect the investment decision.

A: Price to book ratio (P/B) is determined by dividing price per share of a firm to its book value per…

Q: What questions should managers answer when considering special pricing orders?

A: Definition:   Special Pricing: When businesses get Special orders from its customers for bulk…

Q: Describe two alternative approaches to long-run pricing decisions.

A:

Q: What is the primary disadvantage of basing the costplus pricing formula on absorption cost?

A: Definition: Cost plus-pricing approach: The pricing approach used by the companies to set the target…

Q: which of the following could affect the price

A: Stocks are prone to systematic and unsystematic risks. Factors or risk that affect the entire…

Q: Explain how cost-of-carry is a factor in forward curve prices.

A: Cost of carry is the costs of holding the certain position in the market or in other words it is the…

Q: What are the advantages and disadvantages of target pricing versus cost-based pricing?

A: Advantages of target pricing are as follows: It help in controlling in cost It provide profit with…

Q: Distinguish between the downward demand spiral and the ramifications of this for price choices

A: This question tells about  the downward demand spiral and the ramifications of this for price…

Q: How does capacity affect transfer pricing decisions?

A:

Q: What are the three major influences on pricing decisions?

A: Pricing Decisions:Pricing decisions are those decisions that are related to ascertain the price of a…

Q: What questions should managers answer when setting regular prices?

A: Following are the major factors which managers should answer when the regular prices are fixed:…

Q: Why do you think that having a price structure important?

A: Pricing strategies are the methods companies use to price products and services. Almost all…

Q: Enumerate and explain briefly the limitations of using CVP analysis in pricing decisions.

A: Cost Volume Profit (CVP) analysis is a way to find out how changes in variable and fixed costs…

Q: What is the quantity decision? The pricing decision?

A:

Q: Define the downward demand spiral.

A: Definition:   Push Manufacturing: Push manufacturing is a strategy where the order is made and…

Q: Pricing Strategy

A: Answer: Pricing strategy refers to the method by which companies use to fix the prices for their…

Q: Explain price/EBITDA ratio

A: The EV/EBITDA ratio compares a company's enterprise value to its earnings before interest, taxes,…

Q: Retailers often use psychological pricing as a price-adjustment strategy. Explain this pricing…

A: Cost accounting is the branch of accounting that inspects the cost structure of a business. This…

Q: The initial effect of a shift in the aggregate curve is a rise in both the price level and output *…

A: The initial effect of a shift in the aggregate curve is a rise in both the price level and output…

Q: Explain the following assertion: “Price setting generally requires a balance between market forces…

A: Businesses have to make a lot of decisions in running a business one of which is price setting. They…