Many Companies Are Reluctant to Increase Prices on Routinely Purchased

question 34

Multiple Choice

Many companies are reluctant to increase prices on routinely purchased consumer goods. Instead they:

• A) accept the lower margins and sometimes absorb the loss.
• B) decrease the quantity of the product just below the consumers' j.n.d.
• C) decrease the quality of the product.
• D) all of the above.

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Definitions:

Limited Liability Company

A commercial entity setup that integrates the benefit of paying taxes only once, as seen in partnerships or sole proprietorships, with the advantage of limited personal risk akin to that in a corporation.

Noncorporate Business

An enterprise that operates for profit but is not legally incorporated; examples include sole proprietorships and partnerships.

Limited Partnership

A business organization with one or more general partners who manage the business and assume legal debts and obligations, and one or more limited partners who are liable only to the extent of their investments.

Dissolved

The process of legally terminating the existence of an entity, such as a corporation or partnership, according to the laws of the jurisdiction in which it is registered.