Which of the Following Statements Would Be Most Likely to Be

question 207

Multiple Choice

Which of the following statements would be most likely to be made by a manager with a status quo pricing objective?

• A) "A price of $10.00 will penetrate the market."
• B) "A price of $10.00 will not start a price war with our competitors."
• C) "A price of $10.00 should maximize profits."
• D) "A price of $10.00 will provide a 30% return on investment."
• E) "A price of $10.00 should result in a 9% increase in sales."

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Definitions:

Net Income

The residual income of a business post all deductions, including taxes and expenses, from its gross income.

Net Sales

The total revenue generated from sales activities after deducting returns, allowances, and discounts.

Days' Sales in Inventory

A financial ratio that indicates the average time in days that a company takes to turn its inventory into sales.

Ending Inventory

The overall value of products for sale at the close of a fiscal period.