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SVEN [57.7K]
3 years ago
5

A company sells digital music players and is introducing its latest player to the market. The company knows it can’t compete hea

d-to-head with Apple and its iPods at $100. It decides to choose a pricing strategy that will capture more of the market by charging a much lower price of $39. It decides to increase the demand for its digital music players in order to take advantage of economies of scale. What type of pricing strategy should the company choose? a. skim pricing b. penetration pricing c. break-even pricing
Business
1 answer:
Katyanochek1 [597]3 years ago
4 0

Answer:

b. penetration pricing

Explanation:

Market-penetration pricing is nothing but strategy where the price that is set low in order to gain market share. In price penetration, the product is not highly distinctive. Low cost attracts price sensitive customers and they will prefer to buy the product because of its low cost.

This helps in increasing the market share as more customers will be attracted towards the products or services. This pricing strategy helps in developing the economies of scale. This refers to business optimizing profits by lowering the operational cost and improving the efficiency.

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The objective of maximizing value for the shareholders provides an important theme in corporate finance. This objective is not w
Illusion [34]

Answer:

D

Explanation:

Agency conflicts arises  when the objectives of managers isn't aligned with that of shareholders.

Due to the objective of maximising value for shareholders, managers might be induced to engage in aggressive accounting practices in order to present a higher profits than might actually exist. This practice is unethical. This places more emphasis on profits than cash flows.

4 0
3 years ago
What type of arrangement(s), if any, would avoid double taxation for Wendall's and Shirley's endeavor? Choose the best answer if
musickatia [10]

Answer:

An s corporation or a limited liability company, but not a corporation.

Explanation:

5 0
3 years ago
You have decided to buy a used car. The dealer has offered you two options: (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use
Marysya12 [62]

Answer:

1. In option (a), the dealer would charge $18,213.54.

b. In present value terms, the one-time payment (option (b) is a better deal for the purchaser.

Explanation:

a) Data and Calculations:

Monthly payment for a used car = $620

Payment period = 20 months

Additional payment at the end of 20 months = $12,000

Annual interest rate = 24%

One-time payment for the car purchase = $16,864

From an online financial calculator, the present value of the payments is:

N (# of periods)  20

I/Y (Interest per year)  24

PMT (Periodic Payment)  620

FV (Future Value)  12000

Results

PV = $18,213.54

Sum of all periodic payments = $12,400.00

Total Interest = $6,186.46

3 0
3 years ago
What is not true about bartering?
kenny6666 [7]
<span>Bartering can be more time-consuming than trading with money.
Hope it helps.














































</span>
5 0
3 years ago
Explain the difference between the law of diminishing marginal returns and the law of dininishing marginal rate of techinal subs
leonid [27]

Answer:

The primary difference between those two concepts is focus that each term has. The first one focus on the relationship between the level of production and the level of return. While the second one focus on the relationship between the level of production and the amount of factors used for that production.

Explanation:

One the one hand, the law of diminishing marginal returns is a concept known in the microeconomics theory due to the fact that it establishes the relationship between the productivity and the income for every aspect of it. Meaning that, when the productivity increases because of the increase of only one factor of production then the income will start to slowly decrease, confirming that when only one factor is increased the production will start to be incomplete and the return will decrease for that.

On the other hand, the law of diminishing marginal rate of technical substitution indicates the relationship between the level of output and the different factor used to produce. Meaning that, it shows how to keep the level of output the same while making changes in the amount of factors used.

3 0
3 years ago
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