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

Q: Cost-Savings Sharing Pricing Defined?

A: It is a project pricing technique where the savings in the cost of the project are mutually shared…

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: Differentiate between price risk and reinvestment risk.

A: Price risk is the risk of decline of the price of the investment or an asset after the underlying…

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: 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: The hypothesis that market prices reflect all publicly-available information is called efficiency in…

A: Efficiency of stock market is determined by the effect of information whether publicly available or…

Q: Explain primary market

A: Primary market is the market under which the securities of the companies are created. In the primary…

Q: Define spot markets

A: A place where numerous sellers, as well as buyers, come together for exchanging services and…

Q: Define predatory pricing, dumping, and collusive pricing.

A: Target Costing:Target costing refers to the cost that is ascertained as per the needs and wants of…

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: Define pricing decisions.

A: Selling Price:   It refers to the price at which the product or service will be sold in the market…

Q: What is a market order? What is a limit ordrer?  how are each executed?

A: Market order is a type of instructions in the stock market to purchase or sell the securities…

Q: What is market multiple method?

A: The market multiple methods is a hypothesis of valuation, in view of the reason that comparative…

Q: A quantitative analysis enables a decision maker to put a “price” on the sum total of the…

A: Definition: Quantitative analysis: A quantitative analysis focuses on the factors in a decision…

Q: Explain the difference between market-based transfer prices and cost-based transfer prices.

A: Market based Transfer Price and Cost Based Transfer Price: Transfer pricing refers to the rules and…

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: Determining the best approach to pricing requires a cost-benefit trade-off. Explain.

A: The best approach to pricing requires the cost benefit trade-off is explained as below, The Best…

Q: Explain purchasing power parity

A: The formula to compute purchasing power parity:

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: What is offer price?

A: Bid price is the maximum price which the buyer is willing to pay to purchase. In other words, it…

Q: What does the lower-of-cost-or-market (LCM) rule require?

A: Lower-of-cost-or-market: The lower-of-cost-or-market (LCM) is a method which requires the reporting…

Q: commercial market trade industries market segmentation inelastic demand

A: Market is a place where parties gather to exchange goods and services. Parties involved are known as…

Q: Under what conditions is a market-based transfer price optimal?

A:

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

A:

Q: Describe and apply the lower-of-cost-or-market rule.

A: Cost:   It is the economic value incurred by an organization to produce a product or render a…

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: Explain CMO Price Behavior and Prepayment Rates?

A: The question is based on the concept of Collateralized Mortgage Obligations (CMO) , interest rate…

Q: give empirical evidence about market efficiency stong form

A: Introduction : In simple words, strong form market efficiency hypothesis states that securities in…

Q: Understand and apply the lower-of-cost-or-market rule.

A: Cost: It is the economic value incurred by an organization to produce a product or render a service.

Q: Discuss the differences between a market order, limit order, and stop order.

A: Solution: Stock market is the place where securities are traded in market. There are different types…

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

A:

Q: Define Arbitrage Pricing Theory (APT)

A: Arbitrage is the method of making profit from the temporary change in the cost of shares by buying…

Q: Pricing Strategy

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

Q: Outline the rules for identifying the optimal transfer price.

A: Transfer pricing:- Transfer pricing is considered as the value that is attached to those goods and…

Q: Describe Estimating Supplier Costs Using Reverse Price Analysis?

A: Reverse pricing analysis is a pricing model which allows its consumers in order to establish the…

Q: Explain the objectives of transfer pricing and describe the advantages anddisadvantages of various…

A: Transfer pricing in tax and accounting relates to the laws and procedures for the selling/buying…

Q: How is the price of an item established in a target pricing contract?

A: Target pricing is the approach which is innovative and used at the initial stage of the new…

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…

Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.