Why Do Marketers Consider Prestige Products to Be an Exception

question 91

Multiple Choice

Why do marketers consider prestige products to be an exception to the law of demand?

• A)The demand curve for prestige products slopes downward and to the right.
• B)Increasing the price of prestige products can make them seem more desirable.
• C)Demand for prestige products often is greater than supply.
• D)Prestige products such as diamonds,sapphires,and emeralds are nonrenewable resources.
• E)Customers are more aware of any price changes to prestige products.

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Definitions:

Overhead Applied

The assigning of overhead costs to goods produced based on a predetermined rate or basis such as machine hours or labor hours.

Activity-Based Costing

An accounting technique that tags and apportions the costs of organizational activities to every product and service in line with their real consumption.

Activity Rate

The predetermined rate used to allocate overhead costs to products or services based on a specific activity measure, such as machine-hours or labor-hours.

Labor-Related Activity

Activities or tasks that directly involve or are associated with the workforce's efforts in the production process or service delivery.