If a Firm Engages in Price Discrimination, It May Defend

question 361

True/False

If a firm engages in price discrimination, it may defend itself by showing that there is a cost justification for charging different customers different prices.

Recognize and correctly use legal references and terminology.

Develop skills in writing with clarity and precision for legal contexts.

Identify and apply the principles of paragraph construction in legal writing.

Utilize active voice and avoid passive voice in legal writing.

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Definitions:

Unrealized Holding Gains

Increases in the value of assets that an entity holds but has not yet sold, and thus are not reflected in the income statement until sold.

Absorption Costing

A costing method that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed manufacturing overhead - in the cost of a product.

Production Costs

Expenses directly associated with the manufacturing of goods, including materials, labor, and overhead.

Variable Costing

A cost accounting method that includes only variable production costs in unit product costs, and treats fixed costs as period expenses that are charged against revenue in the period they are incurred.