Question : 43. A pricing strategy that sets the price at a premium : 1208167

 

43. A pricing strategy that sets the price at a premium under the assumption that people will pay more for the product because of the product’s brand name, media attention, or some other reason that has piqued the interest of the public is known as: 

A. cost-plus pricing.

B. premium pricing.

C. prestige pricing.

D. target pricing.

44. Craddock Company plans to introduce a new product. A market research specialist claims that 20,000 units can be sold at a $100 selling price. Assuming the company desires a profit margin of 20% of sales, what is the target cost per unit? 

A. $120

B. $100

C. $80

D. $20

45. A market research specialist told Peachtree Company that it could expect to sell 500,000 units of its new high-capacity computer disk at a price of $5. Assuming the company desires a profit margin equal to 25% of sales, what target cost per unit is necessary? 

A. $1.25

B. $5.00

C. $3.75

D. None of these

46. Acme Company has variable costs equal to 40% of sales. The company is considering a proposal that will increase sales by $10,000 and total fixed costs by $6,000. By what amount will net income increase? 

A. $6,000

B. $4,000

C. $2,000

D. $0

47. Which of the following is not an assumption made when performing cost-volume-profit analysis? 

A. Number of units produced is greater than the number of units sold.

B. Worker efficiency is held constant.

C. The company produces within the relevant range of activity.

D. There is a linear relationship between cost and volume for both fixed and variable cost.

48. How does the cost-volume-profit model accommodate non-linear costs and revenues? 

A. Non-linear costs and revenues are ignored by the model.

B. Output volume is segregated into distinct ranges within which a linear relationship is expected to approximate the actual cost or revenue behavior.

C. It is not a problem since non-linear costs and revenues do not exist in practice.

D. None of these is correct.

49. Which of the following is not one of the assumptions underlying cost-volume-profit analysis? 

A. Costs are linear.

B. Production equals sales.

C. All costs can be segregated into fixed and variable components.

D. Revenues are non-linear.

50. Marlowe Company has a contribution margin ratio of 30%. The company is considering a proposal that will increase sales by $150,000. What increase in profit can be expected assuming total fixed costs increase by $25,000? 

A. $5,000

B. $20,000

C. $25,000

D. $15,000

51. Warriner Company has developed the following budgeted income statement:

   

A. increase by $1,600

B. increase by $1,440

C. increase by $10,000

D. decrease by $4,400

52. A product has a contribution margin of $5 per unit and a selling price of $25 per unit. Fixed costs are $20,000. Assuming new technology increases the unit contribution margin by 50 percent but increases total fixed costs by $13,750, what is the new breakeven point in units? 

A. 2,500 units

B. 2,750 units

C. 4,500 units

D. 4,000 units

 

 

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more