Which of the Following Is an Example of Agency Pricing

question 35

Multiple Choice

Which of the following is an example of agency pricing?

• A) A department store gets a cut on the selling price of a product, which is set by the product's manufacturer.
• B) A retail store purchases merchandise from a manufacturer and sells the merchandise at whatever prices it wishes to charge.
• C) The government of a country sets the minimum price for certain agricultural products to cover the costs incurred by the farmers.
• D) A manufacturer and a retailer work in a collaborative manner to decide the price of the final product.
• E) The government of a country sets the maximum price for a certain product that retailers cannot exceed.

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Definitions:

Avoidable Fixed Costs

Fixed costs that can be eliminated if a particular business segment or operation is discontinued.

Idle Capacity

Unused or unutilized production capacity within a business, often leading to inefficiency and increased costs.

Constrained Resource

A limited resource that restricts a company's ability to meet demand, such as limited machine time or labor hours.

Automated Factory

An automated factory utilizes advanced machinery and computer systems to perform tasks with minimal human intervention, increasing efficiency and production.