Which of the Following Can Create a "Real Rigidity" in Price

question 43

Multiple Choice

Which of the following can create a "real rigidity" in price setting?

• A) constant marginal cost as output rises
• B) fixed contracts to sell at a given price
• C) existing advertisements which include prices
• D) item prices for goods on store shelves
• E) menu costs

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Definitions:

Subcontractingcost

The expense incurred when a business hires outside contractors to perform tasks that could be done internally or as part of a project.

Inventory Holding Cost

Inventory holding cost refers to the total cost associated with storing unsold goods or materials, including warehousing, depreciation, insurance, and obsolescence costs.

Subcontracting

The practice of assigning part of the obligations and tasks of a contract to another party, often to specialize or expedite processes.