The Reason That Higher Prices May Not Affect Consumer Buying

question 45

Multiple Choice

The reason that higher prices may not affect consumer buying for some offerings is that

• A) most consumers prefer brand names which have higher prices.
• B) 70 percent of the total population looks for quality services and are willing to pay higher prices.
• C) consumers believe that higher prices indicate higher quality or prestige.
• D) most consumers are in a position to purchase higher priced goods.

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Definitions:

One-Shot Approach

The one-shot approach is a method that attempts to resolve or achieve a particular goal in a single, concentrated effort.

Net Present Value

The variance between cash inflows' present value and cash outflows' present value across a specific timeframe.

Monthly Interest Rate

The proportion of a loan or investment's principal that is charged or earned as interest every month, recalculated based on the period.

Incremental Cash Flow

The additional cash flow a company receives from taking on a new project, important for analyzing the potential profitability of investment opportunities.