Refer to the Diagrams, Which Show Identical Marginal Utility from Income

question 146

Multiple Choice

Refer to the diagrams, which show identical marginal utility from income curves for Singer and Catalano. The marginal utility from income curves are drawn on the assumption that

• A)Singer buys more inferior goods than does Catalano.
• B)Singer and Catalano have identical capacities to enjoy income.
• C)Catalano has a greater capacity to enjoy income than does Singer.
• D)Singer has a greater capacity to enjoy income than does Catalano.

Calculate desired profit margin and understand its application in pricing.

Understand the relationship between current full cost, profit margin, and target selling price.

Comprehend the impact of fixed and variable costs on product pricing.

Analyze profit margin changes when cost reduction is not possible.