Which of the Following Would Be an Example of a Constraint

question 113

Multiple Choice

Which of the following would be an example of a constraint in Step 1 of the price-setting process?

• A)We can rely on our reputation for our other products in the line.
• B)Experts are predicting a surge in global demand.
• C)We need to make allowances for large quantity orders.
• D)We should increase the price during the holiday shopping season.
• E)We're going to face some aggressive competition.

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Definitions:

Shortage

A situation where the demand for a product or service exceeds its supply in a market.

Binding Price Floor

A government-imposed price control or limit that sets a minimum price for a good or service, above the equilibrium price, causing a surplus in the market.

Quantity Supplied

The amount of a good or service that producers are willing to sell at a given price over a certain period of time.

Quantity Demanded

The overall volume of a good or service that customers are ready and financially able to acquire at a certain price point.