Web Sites Like Ultramuzzic

question 62

Multiple Choice

Web sites like Ultramuzzic.com and Sonetz.com pursue a(n) ________ approach for applying freeconomics when they offer free music downloads for users because reproduction and distribution of these products come at no cost.

• A) gift economy
• B) zero marginal cost
• C) advertising
• D) cross subsidies
• E) freemium

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Definitions:

FIFO Perpetual

An inventory valuation method that treats the first items purchased as the first ones sold, continually updating inventory records.

Beginning Inventory

The value of all stock held by a company at the start of an accounting period, before any purchases or sales.

Units Sold

Refers to the total number of individual items sold by a company during a specific period, indicative of sales volume.

Goods On Consignment

Goods given to a third party (consignee) to sell, where the original owner (consignor) retains ownership until sale.