All categories

3 years ago

Why do companies lower product prices and offer free samples?

Business

2 answers:

shtirl [24]3 years ago

4 0

Answer:

A.to find out what people want in a product

Explanation:

Companies lower the value of products in a variety of ways, the main one being when demand falls. Free sample offering typically occurs when companies want consumers to test their products. This is mainly when new products are launched. A strong corporate strategy is to associate the price drop with the offer of free samples. This will cause the company to test consumer taste at the same time and to evaluate the demand for the product tested at a certain price. If the product is well accepted by consumers, in the future the company may raise the price if the demand for the product is high.

Lemur [1.5K]3 years ago

3 0

The best choice here is A) They give out the samples and free trials as a test to see how common it is for people to be interested in their product.
Hope this helps

You might be interested in

g Marginal revenue product measures the rev: 06_21_2018 Multiple Choice amount by which the extra production of one more worker

Anton [14]

Answer: The correct answer is the first statement.

Explanation: Marginal revenue product measures the amount by wich the extra production of one more worker increases a firm's total revenue.

<u>It is an economic term used to describe the change in total income that results from a unit change of one type of input variable. There are many types of input variables that you can change, such as adding an employee or a new machine.</u>

5 0

4 years ago

Copy equipment was acquired at the beginning of the year at a cost of $25,500 that has an estimated residual value of $2,300 and

nalin [4]

Answer:

(A) $23,200

(B) $0.02 per copy

Explanation:

Given that,

Cost of equipment = $25,500

Estimated residual value = $2,300

Estimated useful life = 5 years

Estimated Output = 1,160,000 copies

Copies made this year = 221,000

Depreciation refers to the reduction in the value of fixed assets with the passage of time.

(A) The depreciable cost is determined by subtracting the residual value from the cost of acquiring copying equipment.

Depreciable cost:

= Cost of equipment - Estimated residual value

= $25,500 - $2,300

= $23,200

(B) Depreciation rate is calculated by dividing the depreciable cost by the estimated output.

Depreciation rate:

= Depreciable cost ÷ Estimated output

= $23,200 ÷ 1,160,000

= $0.02 per copy

(C) Units-of-output depreciation for the year is calculated by multiplying the depreciation rate with the number of copies made this year.

Units of output depreciation for the year:

= Depreciation rate × Copies made this year

= $0.02 per copy × 221,000

= $4,420

3 0

3 years ago

"in a small european country, it is estimated that changing the level of capital from $8 million to $10 million will increase

lawyer [7]

I think it’s 12mill I think

6 0

3 years ago

Steve sells his home to Srivani and ends up with a producer surplus of $100,000. Srivani has a consumer surplus of $1,000 from t

amid [387]

Answer:

Both parties experience surplus, but there is inequity because Steve has a much larger producer surplus

Explanation:

The options to this question wasn't provided. Here are the options : Both parties experience surplus, but there is inequity because Steve has a much larger producer surplus. Both parties experience surplus, so the transaction was equitable. Only Steve benefits from the sale. Srivani will not be happy with her purchase.

Consumer surplus is the difference between the willingness to pay of a consumer and the price of the good.

Producer surplus is the difference between the price of a good and the least amount the seller is willing to sell his good.

While both parties earn a surplus, the producer surplus exceeds the consumer surplus . Therefore, the seller benefited more from the trade than the consumer.

I hope my answer helps you

3 0

3 years ago

Jimmer’s nominal income will go up by 10 percent next year. Inflation is expected to be – 2 percent next year. By approximately

kompoz [17]

Answer:

Nominal interest rate (n) = 10% = 0.10

Inflation rate (i) = -2% = -0.02

Real interest rate (r) = ?

Application of Fisher's Equation

(I + n) = (1 + r)(1 + i)

(1 + 0.10) = (1 + r)(1 + -0.02)

1.10 = (1 + r)(0.98)

<u>1.10</u> = 1 + r

0.98

1.1224 = 1 + r

1.1224 - 1 = r

r = 0.1224 = 12.24%

Jimmer's real income will change by 12.24% next year.

Explanation:

In the determination of the rate of change in real income, there is need to apply Fisher's equation. The nominal rate and inflation rate have been given, thus, we will make the real rate the subject of the formula.

3 0

3 years ago