1. What is meant by Cost-plus Pricing?
- This is the method of pricing which considers the toal cost per unit and then adds on a percentage to arrive at a final price.
- For example selling a product at £49.99 instead of £50 makes customers think of it as less than £50
1 of 20
Other questions in this quiz
2. Which one of these is a motive for becoming an entrepreneur?
3. Define A theory X Manager?
- dislike employees and reduces their wages
- assume their employees are lazy and prefer to be given firm direction with strict controls> Managers will adopt to a stick and carrot approach to make them work hard. This may involve targets with heavy penalties if they are not met.
- assume that human beings want to work and will commit themselves to work effectively without strict controls. They will engage with the objectives of the organisation, accept responsibility and use their initiative to help solve problems
4. A cost that change with the level of output?
- Fixed Costs
- Variable Costs
5. Define what is meant by Price Skimming?
- Some firms set their prices the same as their competitors
- this strategy uses a high price to enter the market. Even though the price is high, some people may still be eager to try a new product once sales from the group of people disappear the price of the product can decrease to attract new customers.
- this strategy uses a low price to enter the market & gain market share
Similar Business Studies resources: