True. Managers should consider the price sensitivity of the target market when setting prices.
<h3>What is meant by price sensitivity?</h3>
The degree to which demand fluctuates as a product's or service's price changes is known as price sensitivity. The price elasticity of demand, which implies that certain buyers won't pay more if a lower-priced choice is available, is a typical method for measuring price sensitivity.
By dividing the percentage change in quantity demanded by the percentage change in price, one can calculate price sensitivity. Sensitivity in finance refers to how much a market instrument will change in response to changes in underlying factors, most frequently in terms of how its price will move in response to other circumstances.
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Managers should consider the price sensitivity of the target market when setting prices.
t OR f
Answer
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Step-by-step explanation:
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Answer:
Consider the likelihood that the risks could result in material misstatements.
Explanation:
The risk of material misstatement is the risk that the financial statements of an organization have been misstated to a material degree. This risk is assessed by auditors at the following:
At the assertion level. This is further subdivided into inherent risk and control risk. Inherent risk is the susceptibility of an assertion to misstatement because of error or fraud, before considering controls. Control risk is the risk of misstatement that will not be prevented or detected by a reporting entity's internal controls.
At the financial statement level. Relates to the financial statements as a whole. This risk is more likely when there is a possibility of fraud.