Which of the Following Is a Psychological Factor Relevant to Pricing

question 25

Multiple Choice

Which of the following is a psychological factor relevant to pricing decisions of a bakery?

• A) How many loaves of bread will a potential buyer consume every month?
• B) Are the orders coming from households or sandwich shops?
• C) Will a low price indicate inferior quality to the potential buyer?
• D) How many potential buyers for multigrain bread are there?

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Definitions:

Overhead Expenses

Ongoing costs of operating a business that are not directly associated with the production of goods or services, such as rent, utilities, and administrative costs.

Operating Profit

The income generated by a company's main business activities, not including interest and tax deductions.

Markdown

A reduction from the original or previous selling price of goods or services.

Breakeven

The juncture where total expenses match total income, leading to neither a net profit nor a loss.