c12 - MULTIPLE CHOICE 44 Companies should ONLY produce and...

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MULTIPLE CHOICE 44. Companies should ONLY produce and sell units as long as a. there is customer demand for the product. b. the competition allows it. c. the revenue from an additional unit exceeds the cost of producing it. d. there is a generous supply of low-cost direct materials. Answer: 45. c Difficulty: 2 Objective: 1 Too high a price may a. deter a customer from purchasing a product. b. increase demand for the product. c. indicate supply is too plentiful. d. decrease a competitor s market share. Answer: a Difficulty: 1 Objective: 1 46. Companies must ALWAYS examine pricing a. based on the supply of the product. b. based on the cost of producing the product. c. through the eyes of their customers. d. through the eyes of their competitors. Answer: c Difficulty: 3 Objective: 1 47. Competitors a. with alternative products can force a company to lower its prices. b. can gain a competitive pricing advantage with knowledge of your costs and operating policies. c. may span international borders. d. may be all of the above. Answer: d Difficulty: 2 Objective: 1 48. Fluctuations in exchange rates between different currencies can influence a. the cost of products using foreign suppliers. b. the pricing of alternative products offered by foreign competitors. c. the demand for products of foreign competitors. d. all of the above. Answer: d Difficulty: 2 Objective: 1 49. The cost of producing a product a. is an important influence on pricing. b. affects the willingness of a company to supply a product. c. for pricing decisions includes manufacturing costs, but not product design costs. d. in highly competitive markets controls pricing. Answer: b Difficulty: Chapter 12 3 Page 6 Objective: 1 50. In a noncompetitive environment, the key factor affecting pricing decisions is a. the customer s willingness to pay. b. the price charged for alternative products. c. the cost of producing and delivering the product. d. all of the above. Answer: a Difficulty: 3 Objective: 1 51. In a competitive market with differentiated products like cameras, the key factor(s) affecting pricing decisions is/are a. the customer s willingness to pay. b. the price charged for alternative products. c. the cost of producing and delivering the product. d. all of the above. Answer: d Difficulty: 2 Objective: 1 52. Three major influences on pricing decisions are a. competition, costs, and customers. b. competition, demand, and production efficiency. c. continuous improvement, customer satisfaction, and supply. d. variable costs, fixed costs, and mixed costs. Answer: a Difficulty: 1 Objective: 1 53. Long-run pricing decisions a. have a time horizon of less than one year. b. include adjusting product mix in a competitive environment. c. and short-run pricing decisions generally have the same relevant costs.
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This note was uploaded on 08/28/2010 for the course ACCTG 101 taught by Professor Smith during the Spring '10 term at Alabama State University.

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c12 - MULTIPLE CHOICE 44 Companies should ONLY produce and...

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