________ Is the Process Used to Determine the Profitability of a Product

question 41

Multiple Choice

________ is the process used to determine the profitability of a product at various levels of sales.

• A) Cost-based pricing
• B) Break-even analysis
• C) Demand-based pricing
• D) Competition-based pricing

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Definitions:

Representativeness Heuristic

A cognitive shortcut that involves judging the probability of an event by its similarity to a prototype or an example that comes to mind, rather than on objective probability.

Availability Heuristic

A mental shortcut that relies on immediate examples that come to a given person's mind when evaluating a specific topic, concept, method, or decision.

Confirmation Bias

The propensity to find, interpret, choose, and recollect details in a way that corroborates the existing beliefs or hypotheses of a person.

Hindsight Bias

The tendency to believe, after learning an outcome, that one would have foreseen it.