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ACC/ACF 2200 Introduction to ManagementAccountingWeek 9 (Chapter 20) Tutorial SolutionsSemester 1, 2020Note to students: Beware! These solutions are not necessarily modelanswers. In exams, you will not have demonstrated yourunderstanding of the answers to these exercises if you seek only tomemorise them. You are encouraged to use tutorial time to discussissues that will test and clarify your understanding of theseexercises, as well as expanding your analytical and critical-thinkingskills.20.1Major influences on pricing decisions can be both internal or external. They would usually include (but are notlimited to) the following:market positioning (how companies position themselves in the market can influence prices)product cost (these set the lower limits for prices)customer value (customers value the price of goods or services, as well as the perceived benefits of thegoods or services)competitor behaviour (can affect pricing decisions)legal, political and ethical issues (laws must be adhered to, products can be subject to political challengesand ethical considerations must be taken into account when pricing).20.12(a)Skimming pricing: setting the initial price for a new product high in order to reap high short-term profits.