Charlie Ferragamo Is a Sales Representative for the Season-All Spice

question 44

Multiple Choice

Charlie Ferragamo is a sales representative for the Season-All Spice Company, and sells spices to large food service operations and restaurants. Charlie used to be able to justify selling his products for a higher price than the competition because he believed his spices were of higher quality. However, now the demand for individual brands of spices has become very elastic because buyers perceive few differences among the brands. One of Charlie's regular customers told Charlie that another spice company offered him a significantly lower price on spices, and he asked if Charlie could match the price. Charlie said, "I have to see a written price quote from the competitor. If I lower my price without seeing the price quote, I could be accused by my other customers of engaging in ________________."

• A) dumping
• B) price discrimination
• C) price fixing
• D) zone pricing
• E) None of these is a good answer

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Definitions:

Hypothetical Thought

Reasoning that includes propositions and possibilities that may not reflect reality.

Analytic Thought

Thought that results from analysis, such as a systematic ranking of pros and cons, risks and consequences, possibilities and facts. Analytic thought depends on logic and rationality.

Intuitive Thought

Thought that arises from an emotion or a hunch beyond rational explanation, and is influenced by past experiences and cultural assumptions.

Egocentrism

Piaget’s term for children’s tendency to think about the world entirely from their own personal perspective.