
Practical Management Science
6th Edition
ISBN: 9781337406659
Author: WINSTON, Wayne L.
Publisher: Cengage,
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If the price elasticity of demand for used cars priced between $4,000 and $6,000 is -0.75 (using the mid-point method), what will be the percentage change in quantity demanded when the price of a used car falls from $6,000 to $4,000? Instructions: Round your answer to the nearest whole number (percentage).
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- You are the new CEO of a major well-established automotive manufacturer in South Korea, but you are concerned that the longstanding price war in the industry is undermining profits for all firms in this sector. However, you have been warned by your company’s in-house corporate lawyers not to openly discuss pricing with rival firms. In several cases, you know the other CEOs personally because you graduated from the same business school as they did. Required: Given this dilemma, how would you develop an effective strategy to ensure you act in the best interests of your company, but without engaging in collusion, which is illegal? Discuss.arrow_forwardThe terms shadow price and reduced cost mean the same thing. Your answer: True O False Clear answerarrow_forwardThe law of demand states that as the price of a good increases: more of it is produced. O buyers desire to purchase less of it. O government will start to regulate it. O suppliers wish to sell less of it.arrow_forward
- A computer company's yearly inventory cost is 39 percent (which accounts for the cost of capital for financing the inventory, warehouse space, and the cost of obsolescence). Last year, the company had $375 million in inventory and cost of goods sold of $29 billion.What is the company's total inventory cost for the year (in million $s)? Note: Round your answer to the nearest integer.arrow_forwardConditions for demand are consumers O willingness but not ability to buy willingness and ability to sell O willingness and ability to buy O ability but not willingness to buyarrow_forwardWhich of the following scenarios would cause the price of avocados to rise? Select all that apply. An increase in the supply of avocados An increase in wages paid to avocado farm workers Better infrastructure reduces the cost to transport avocados A return to sanity where people put jelly on their toast instead of avocado A reduction in tariffs on avocados imported from Mexico An increase in demand for avocado toastarrow_forward
- Because market and operating conditions are different in each target market all consumers will react similarly to the firm's pricing strategy. the choice of a pricing strategy is not specific to the target market. prices need to be held constant because everything else is changing. only horizontal price fixing should be used. none of the above.arrow_forwardWhat other factors besides price should be considered before changing your purchasing procedures?arrow_forwardAs purchasing agent for Eynan Enterprises in Richmond, Virginia, you ask your buyer to provide you with a ranking of "excellent" (worth 4 points), "good" (3 points), "fair" (2 points), or "poor" (1 point) for a variety of characteristics for two potential vendors, Donna Inc. (D) and Kay Corp. (K). You suggest that "Products" total be weighted 0.4, the "Company" total be weighted 0.2, and the "Service" and "Sales" totals each be weighted 0.2. The buyer has returned the following ranking. Which of the two vendors would you select? Click the icon to view the rankings. Part 2 You should choose vendor ▼ Donna Inc. Either Kay Corp. or Donna Inc. Kay Corp. , with a weighted score of ________. (Enter your response rounded to one decimal place.)arrow_forward
- Why do most demand curves demonstrate an inverse relationship between price and quantity?arrow_forwardJune is looking into buying her first home. She is shown a number of houses on the market, but the market appears to be sluggish because there are so few buyers. Interest rates are steady and June has several good prospect homes to choose from at reasonable prices. June is in a... O Seller's market O Lender's market O Builder's market O Buyer's marketarrow_forwardAn expectation about the price of a given product is known as Group of answer choices quote. market price. reference price. pricing strategy.arrow_forward
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