When Circuit Town Electronics Sets Its Televisions at Three Price

question 113

Multiple Choice

When Circuit Town Electronics sets its televisions at three price levels of $699, $899, and $1,099, it is most likely using ________.

• A) price fixing
• B) price lining
• C) penetration pricing
• D) skimming pricing
• E) loss leader pricing

---

Definitions:

Asset Allocation

The strategy of dividing investments across various asset categories, such as stocks, bonds, and cash, to optimize risk and return.

Treynor-Black Model

A portfolio optimization model that adjusts for risk and incorporates passive and active components.

Active Portfolio

An Active Portfolio is a collection of investments actively managed by fund managers or investors, regularly making buy, sell, and hold decisions in an attempt to outperform the benchmark index.

Abnormal Returns

Returns on a stock or portfolio that differ significantly from the expected return based on the market or certain benchmarks.