DaimlerChrysler Discovered That Many of Its 2002 Prowlers Automobiles Had

question 7

Multiple Choice

DaimlerChrysler discovered that many of its 2002 Prowlers automobiles had faulty fuel systems that could cause the vehicles to stall in traffic.Which one of the marketing mix strategies should the auto manufacturer use to alert buyers to this problem?

• A) product
• B) promotion
• C) production
• D) pricing
• E) distribution

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Definitions:

Average Fixed Cost

The fixed costs (costs that do not vary with output) divided by the quantity of output produced.

Marginal Cost

The expense addition due to the manufacture of one more product or service unit.

Average Variable Cost

The total variable costs (e.g., materials, labor) divided by the quantity of output produced, representing the variable cost per unit.

Marginal Cost

The hike in cost associated with the creation of an extra unit of a good or service.