While Pricing Objectives Frequently Reflect Corporate Goals, Pricing Constraints Often

question 41

Multiple Choice

While pricing objectives frequently reflect corporate goals, pricing constraints often relate to

• A) stockholder demands.
• B) political ideology.
• C) conditions existing in the marketplace.
• D) an organization's code of ethics.
• E) the financial realities within the organization itself.

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Definitions:

Collusive Duopoly

A situation where two firms in a market agree to collaborate, often secretly, to increase their joint profits by agreeing on prices or output levels.

Extensive Form

A representation of a game in decision tree format, showing the sequence of moves, possible strategies, and outcomes.

Credible Threat

In a sequential game with two players, a statement made by Player 1 that truthfully (credibly) threatens a penalizing action against Player 2 if Player 2 does something that Player 1 does not want Player 2 to do. Opposite of empty threat.

Coercion

Coercion refers to the practice of persuading someone to do something by using force or threats.