1. Which of the following is NOT true about pricing decisions?
a. Customers NEVER have an influence on demand and supply
2. Kaizen is a continuous improvement technique used to the time it takes to do a task, eliminate waste, and improve operating efficiency and productivity. a. True 3. The higher the price a monopolist sets, the lower the demand for the monopolists product as customers seek substitute products or forgo buying the product. a. True 4. Companies operating in less competitive markets offer products or services that differ from each other. a. True 5. $6,250,000 on the sales order activity and 5,500 sales orders. a. = 6250000/5500 batch-level costs. 6. The lower the cost of producing a product, the greater the quantity of product the company is willing to supply. a. True 7. _____ tracks and accumulates business function costs across the entire value chain from a products initial R&D to its final customer service and support. a. Life-cycle costing 8. Invested $3,500,000. $250,000 annually. Sales of 800 at $1,100.00 each a. Target Rate of Return =250000/3500000 = 7.14% 9. Companies operating in competitive markets much NOT accept the prices set by the market. a. False 10.Sales-order cost are a. Batch-level costs 11.In reference to locked-in cost curves and the cost-incurrence curves, the top curve plots: a. Cumulative locked-in cost 12.Investment capital $80,000,000 and 16% target rate of return on the investment of 150,000 units. a. Target Annual Operating Income and the target operating income per unit = 80000000*.016 =12,800,000; = 12,800,000/150,000 = $85.33 13.To set long-run process, managers calculate the ___ -cost of producing and selling a product. a. Full-cost 14.The target cost per units is NEVER lower than the existing full cost of the product a. False 15.Invested 2,500,000. $245,000 annually. Actual sales of 700 planks at $500. Target rate on of return on the investment of 15%. a. 2.33%
1. $6,250,000 on the sales order activity and 5,500 sales orders.
a. = 6250000/5500 batch-level costs. 2. Insensitivity of demand to price changes is called: a. Demand inelasticity 3. 7% defect on 140,000units a. 9800 defective units 4. Value engineering decrease both value-added costs a. True 5. The Sherman Act, the Clayton Act, the Federal Trade Commission Act, and the Robinson-Patman Act are: a. Predatory pricing 6. Invested $3,500,000. $250,000 annually. Sales of 800 at $1,100.00 each a. Target Rate of Return =250000/3500000 = 7.14% 7. Life -cycle budgeting highlights costs throughout the products life cycle and, in doing so, facilitates target pricing, target costing, and value engineering at the design stage before costs are locked in. a. True 8. In reference to locked-in cost curves and the cost-incurrence curves, the top curve plots: a. Cumulative locked-in cost 9. In the time-and-materials method, individual jobs are priced based on materials and labor time. a. True 10.12% operating income and target price $750 a. $90 OI and $660 per units 11.The reduction in selling price below list selling pricing to encourage customer to purchase more quantities is: a. Price discount 12.A:200,4500 B:350,3800 C$500,2400 a. 900,000;1,330,00;1,200,000 13.Value engineering entails improvements in product designs, changers in materials specifications, and modifications in process methods. a. True 14.Price discounts are a function of multiple factor a. True 15.Which of the following is NOT true about international competition? a. Fluctuations in exchange rates between Correct! 16.Collusive pricing occurs when companies in an industry conspire a. True 17.$740 full cost, 10%makeup a. Prospective price is $814 18.The higher the price a monopolist sets, the higher the demand for the monopolists product as customers seek substitute products or forgo buying the product. a. False 19.Companies operating in less competitive markets offer products or services that differ from each other. a. True 20.The cost-based approach is also called: