TB Figure: 1

question 29

Multiple Choice

TB Figure: 1
-TB Figure 1 shows there are six distinct steps in the pricing process: identify pricing constraints and objectives; estimate demand and revenue; __________; select an approximate price level; set list or quoted price; and make special adjustments to list or quoted price.

• A)estimate cost, volume, and profit relationships
• B)scan competitors for price lines for similar products or services
• C)select the appropriate pricing formula
• D)establish the lowest and highest possible price range

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Definitions:

User Cost

The cost associated with using a capital asset, considering both the depreciation of the asset and the foregone interest that could have been earned by investing funds elsewhere.

Nonrenewable Resource

A natural resource that cannot be replenished at the same rate at which it is consumed.

Future

A term referring to events that have not yet occurred or financial contracts regarding assets to be delivered or transacted at a later date.

User Cost

The opportunity cost of using a durable good or natural resource, factoring in depreciation and the forgone interest that could have been earned if the money was invested elsewhere.