With prestige goods and services, a higher price may, but not always, result in a higher sales volume.
<h3>What do economists mean by prestige goods?</h3>
Numerous products and services have prestige value, elevating the standing of their owners or users. Such items are referred to be prestige (or status, or positional) goods. These prestige products include things like jewelry, designer apparel, expensive homes and vehicles, and lavish entertainment.
<h3>Why is the demand curve for prestige items different?</h3>
Prestige goods may actually see an increase in demand as a result of price increases since customers perceive them to be more value. The demand curve slopes upward in certain circumstances.
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Answer:
D. Product Divisional Structure
Explanation:
As the consumer products firm with a functional structure is expanding from a single product line into several diverse product groups, with most sales within one country. Product divisional structure should be adopted in order to manage the new conditions most effectively. This is kind of an organizational structure where different organizational departments and functions are separately into different divisions. Each division has all the necessary resources and capacities in order to support different that product line or territory, it has its own IT department, finance, HR and marketing department.
Answer:
Debit Rent expense and credit prepaid rent for $3,250.
Explanation:
When rent is paid in advance, cash is exchanged for another asset known as prepaid expense. This entry is recorded as
Debit Prepaid expense
Credit Cash account
As the rent is used up, the entries required are;
Debit Rent expense
Credit Prepaid expense
Hence as at January 31, rent expense incurred
= 1/12 × $39,000
= $3,250
Answer:
See below
Explanation:
Acorn Health Services Co.
Income statement for the year ended, January 31st
Service revenue $234,500
Expenses:
Depreciation expense
$16,900
Insurance expense
$8,280
Miscellaneous expense
$6,590
Rent expense
$68,300
Supplies expense
$4,060
Utilities expense
$26,030
Wages expense
$255,200
Total expense ($385,360)
Net income (loss) $150,860
<span>This means that there were customers that were wanting the Disney channel, but did not get it because it was too expensive. Once the price went down these customers bought the service. The cable company test showed that they should keep their prices for the Disney channel low to generate more revenue. Even if they only had one customer to begin with they would only be making $10.75, and when they lowed their prices they would be making at least $15.90.</span>
