To Better Take into Account the Differential Impact of Fixed

question 31

Multiple Choice

To better take into account the differential impact of fixed and variable costs,marketing managers can use _________________.

• A)Cost-plus pricing
• B)Price war
• C)Markup on sales price
• D)Average-cost pricing
• E)Target return pricing

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Definitions:

Net Operating Income

The total profit of a company after operating expenses are subtracted from gross income.

Residual Income

The income that remains after subtracting all required costs of capital from operating income.

Average Operating Assets

The average value of the assets used in the normal operation of a business to generate revenue, calculated typically over a fiscal year.

Net Operating Income

A measure of a company's profitability by subtracting operating expenses from its operating revenues.