Consumers Sometimes Prefer Two-Part Pricing Because

question 108

Multiple Choice

Consumers sometimes prefer two-part pricing because:

• A) prices are often perceived as quality indicators.
• B) consumers like to be in control of costs.
• C) consumers are uncertain about the number and types of activities they might use at places like an amusement park.
• D) consumers prefer a limited number of choices.
• E) prices have little or no psychological influence on most consumers.

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Definitions:

Finished Goods

Finished Goods are products that have completed all stages of production and are ready for sale to customers.

FIFO Process Cost Method

An accounting method for valuing inventory and the cost of goods sold based on the assumption that the earliest goods purchased or manufactured are sold first.

Equivalent Units

A method used in process costing that converts partially completed units into a number of fully completed units.

Direct Materials Costs

The cost of raw materials that are directly used in the manufacture of a product.