Which of the Following Is Not a Characteristic of a Complete

question 30

Multiple Choice

Which of the following is not a characteristic of a complete contract?

• A)The contract allows for a party to exploit weaknesses in another party's position as the transaction unfolds
• B)Elimination of opportunistic behaviors
• C)Stipulation of each party's responsibilities and rights
• D)Binding instruction for each party on courses of action as the transaction unfolds
• E)Must be enforceable

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Definitions:

Cost-based Pricing

Cost-based pricing is a pricing strategy where the selling price of a product is determined by adding a profit margin to the cost of making or buying the product.

Skimming Pricing

A pricing strategy involving setting high prices at the launch of a new product to maximize profits from customers willing to pay more, before lowering the price over time.

Prestige Pricing

A pricing strategy where prices are set higher than normal because the product or service is perceived to have a prestigious status or high quality.

Total Variable Costs

The summation of all costs that vary with the level of output or production, such as materials and labor.