A Bakery Has to Set the Price of Its Sourdough

question 67

Multiple Choice

A bakery has to set the price of its sourdough bread.Which of the following is a psychological factor relevant to the pricing decision of the baker?

• A)How many loaves of bread will a potential buyer consume every month?
• B)Are the orders coming from households or sandwich shops?
• C)Will a low price indicate inferior quality to a potential buyer?
• D)How many potential buyers for sourdough bread are out there?

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Definitions:

Representativeness Heuristic

A strategy for judging whether an individual, object, or event belongs in a certain category based on how typical of the category it seems to be.

Typical

Representing the characteristics or qualities of a particular group, category, or class; characteristic.

Frequency Judgment

The process of estimating the rate at which an event occurs or the likelihood of its occurrence.

Availability

The extent to which a resource or service can be used or obtained.