Answer:
Flashfone and Pictech
a. If Flashfone prices high, Pictech will make more profit if it chooses a (high,low) __low___ price, and if Flashfone prices low, Pictech will make more profit if it chooses a(high,low)___low____ price.
b. If Pictech prices high, Flashfone will make more profit if it chooses a(high,low)__low____price, and if Pictech prices low, Flashfone will make more profit if it chooses a (high,low) __low____ price.
c. Considering all of the information given, pricing high (is, is not) _is not_ a dominant strategy for both Flashfone and Pictech.
Explanation:
a) Data and Calculations:
Pictech Pricing
High Low
Flashfone Pricing High 11, 11 2, 18
Low 18, 2 10, 10
b) A dominant strategy exists if Pictech or Flashfone would implement a particular strategy that benefits it no matter what the other firm does.
Answer: Differential cost is $5 per unit
Explanation:
Differential cost is the extra cost that the company would incur if they made the product themselves versus if they bought it from an outside supplier.
Differential cost is therefore:
= Cost to produce internally - Cost from supplier
= 23 - 18
= $5
<em>likely</em>
Technology has been considered the main purchasing agent
Answer:
Measured over equal time periods.
Explanation:
To get an understanding of the <u>rate</u> of return you first need to lay down a period of time that you can use as a baseline when comparing the return of each investment.
