Scenario 12

question 305

Multiple Choice

Scenario 12.4 Use the following to answer the questions.
Glenwood Pet Hospital is considering implementing a new pricing strategy for its veterinarian services. After reviewing the previous three years' revenue, Glenwood finds that most of its customers bring their pets in for the required annual vaccinations and then only if the animal is ill. Glenwood's objective is to generate more income per customer on an annual basis. The hospital has previously priced its services by charging a flat fee for the office visit, a fee for each vaccine, and a fee for each type of examination beyond the basic office visit. Most customers pay the flat office fee and a fee for a rabies vaccine. Glenwood is now considering a new plan where the pet owner would pay one fee that would cover an office visit, the required rabies vaccine, and additional vaccines that prevent heartworm, kennel-cough, and fleas. Glenwood hopes to encourage the pet owners to view their pet's health as part of a prevention program, rather than a one-time annual visit.
Refer to Scenario 12.4. Glenwood's new pricing strategy is an example of ____ pricing.

• A) percentage
• B) cost-based
• C) customary
• D) bundle
• E) demand-based

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Definitions:

FICA-Social Security

A U.S. government program funded by payroll taxes, providing retirement benefits, disability income, and other services to Americans.

Gross Pay

The total amount of money earned by an employee before any deductions or taxes are taken out.

FUTA Tax

The tax imposed by the Federal Unemployment Tax Act, paid by employers to support state employment agencies.

SUTA Tax

State Unemployment Tax Act tax, which is a state-based tax that employers pay to fund the unemployment benefits for workers who lose their jobs.