Though Large Firms Have the Knowledge and Resources to Utilize

question 153

Multiple Choice

Though large firms have the knowledge and resources to utilize a better pricing strategy, many choose to use cost-plus pricing.One reason for this is that

• A)large firms do not have to maximize their profits because they face little competition from other firms.
• B)there is less risk of violating antitrust laws if a cost-plus pricing strategy is used rather than a profit-maximizing pricing strategy.
• C)the additional revenue that would result from a profit-maximizing pricing strategy is an insignificant fraction of the firms' revenues.
• D)firms often adjust the markup they charge to reflect current demand.

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Definitions:

Mode

The value that appears most frequently in a data set.

Mean

The average value in a set of numbers, calculated by dividing the sum of all values by the number of values.

Respondents

Individuals who answer or respond to a survey, questionnaire, or study.

Convergent Validity

The extent to which two theoretically associated measures of constructs are actually interconnected.