Pricing to cover variable costs and some fixed costs as in the case of some automobile distributorships that sell below total costs is typical of which of the following pricing objectives ?

Related Mcqs:

1. A firm in perfectly competitive industry is producing 50 units, its profit-maximising quantity. Industry price is £2 and total fixed costs and total variable cost are £25 and £40 respectively. The firm’s economic profit is ?

   A. £35
   B. £15
   C. £30
   D. £60

2. If Honda uses its company name to cover such different products as its automobile’s lawn mowers and motorcycles, it is practicing which of the following strategies ?

   A. new brand strategy
   B. line extension strategy
   C. multiband strategy
   D. brand extension strategy

3. When marginal costs are below average total costs ?

   A. average fixed cost is rising
   B. average total cost is falling
   C. average total cost is raising
   D. average total cost is minimized

4. The use of price points for reference to different levels of quality for a company’s related products is typical of which product mix pricing strategy ?

   A. Optional-product pricing
   B. Captive-product pricing
   C. By-product pricing
   D. Product line pricing

5. In certain industries Japanese employers hesitate to lay off workers Therefore they sometimes have excess supplies of goods that they cannot sell on the home market without lowering prices. To hold down losses they sell goods in overseas markets at prices well beneath those in japan This practice is best referred to as ?

   A. Orderly marketing
   B. trigger pricing
   C. domestic content pricing
   D. dumping

6. If the price is less than the average costs but higher than the average variable costs ?

   A. The firm is making a loss and will shutdown in the short term
   B. The firm is making a profile
   C. The firm is making a loss but will continue to produce in the short term
   D. The firm is making a loss and is making a negative contribution to fixed costs

7. When a company reviews sales costs and profit projections for a new product to find out whether these factors satisfy the company’s objectives they are in which of the following new process development stages ?

   A. Concept development and testing
   B. Commercialization
   C. Business analysis
   D. Marketing strategy development

8. Total increases from Rs500 to Rs600 when output increases from 20 to 30 units. Fixed costs are Rs200 Which of the following is true ?

   A. Marginal cost is Rs20
   B. Average cost falls
   C. Variable cost rises by Rs100
   D. Average fixed cost is Rs10

9. Total increase from Rs500 to Rs600 When output increases from 20 to 30 units Fixed costs are Rs200 Which of the following is true ?

   A. Marginal cost is Rs20
   B. Average cost rises
   C. Variable cost rises by Rs200
   D. Average fixed cost was Rs10originally

10. If marginal costs equal average total costs ?

    A. average total cost is falling
    B. average total cost is raising
    C. average total cost is maximized
    D. average total cost is minimized