Pricing for One-Time-Only Special Orders Is, Typically

question 55

Multiple Choice

Pricing for one-time-only special orders is, typically

• A)a pricing decision using the time horizon.
• B)a short-run decision.
• C)a long-run decision.
• D)higher in variable costs than usual.
• E)based on fixed costs alone.

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Definitions:

Homothetic Preferences

A consumer preference structure in which utility functions display constant returns to scale, meaning relative consumption patterns do not change as income levels change.

Substitution Effect

The change in consumption patterns due to a change in relative prices of goods, leading individuals to substitute cheaper goods for more expensive ones.

Compensated Demand Function

A demand function that adjusts for changes in income to show how quantities demanded by consumers change in response to a price change while keeping utility constant.

Adequately Paid

Compensation that meets or exceeds the value of the work performed or the qualifications of the individual.