The Adjustment of Price to Maximize the Revenue Obtained from Available

question 85

Multiple Choice

The adjustment of price to maximize the revenue obtained from available capacity that will be lost if not used is referred to as

• A) chase strategy.
• B) yield management.
• C) anticipation inventory.
• D) workforce adjustment.

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Definitions:

Units

The individual elements or items produced or available in some quantity.

Variable Cost

Costs that change in proportion to the level of production or sales activity, such as raw material and labor costs.

Fixed Cost

Expenses that do not vary with the level of production or sales activity, such as rent, salaries, and insurance premiums.

Period Cost

Costs that are expensed in the period in which they are incurred, typically including selling and administrative expenses, rather than being included in the cost of goods sold.