Practice Quiz 10 (chapter 18)

P 488 89 regarding markups and turnover a supermarket

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2. (p. 488-89) Regarding markups and turnover: a. supermarket operators have found that high-margin products are generally more profitable that low-margin products. b. higher markups do not always lead to higher profits. c. low stockturn rates increase costs by tying up working capital in inventory. d. to earn higher profits, all firms should lower their markups and seek faster turnover. E . Both B and C. Difficulty: Medium LearnObj: 2 Perreault - Chapter 18 #85 Question Type: Integrating 3. (p. 490) Setting prices by adding a "reasonable" markup to a firm's average cost is called: Difficulty: Easy LearnObj: 3 Perreault - Chapter 18 #90 Question Type: Definition
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4. (p. 491) Total fixed cost: Difficulty: Medium LearnObj: 3 Perreault - Chapter 18 #92 Question Type: Comprehension 5. (p. 500) To maximize its profit, a producer should set a price (and produce that related output) where: A . marginal cost is just less than or equal to marginal revenue. b. marginal cost is at its minimum. c. price is as high as possible. d. total revenue equals total cost. e. marginal revenue is zero. Difficulty: Medium LearnObj: 5 Perreault - Chapter 18 #143 Question Type: Definition 6. (p. 506) Leader pricing:
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