Answer:
consumer products provided are categorized thus:
(1) relatively expensive: a computer system
(2) infrequently purchased: A car
(3) buyers are willing to expend considerable effort in planning and making purchases: A house
Explanation:
Consumer products are defined as products that satisfy a consumer's wants or needs. There can be convenient, affordable as well as expensive and infrequently purchased.
Consumer goods are final goods sold to consumers for use. It is usually not used as means for further economic production activity.
Some consumer goods are durable and can last for up to three years or more while some are perishable with expiry dates and must be consumed within a short pace of time.
Finally, consumer goods can be grouped into different categories based on consumer behavior depending on how frequently they are used.
Answer:
a. The price that the company should sell the new toy at if it prices at cost plus profit at 100% profit markup is:
= $20.
b. The price that the company should sell the new toy at if it prices using competitive pricing is:
= $22.50 (average of competitors' prices)
c. The price that the company should sell the new toy at if it prices using penetration pricing is:
= $20 (lowest market price)
d. The price that the company should sell the new toy at if it prices using price skimming is:
= $25.
Explanation:
a) Data and Calculations:
Cost of producing a new toy = $10
Competitors' prices are:
Product A – $25
Product B – $20
Product C – $23
Product D– $22
Total = $90
Average price = $22.50 ($90/4)
Cost = $10
Markup 10 ($10 * 100%)
Price = $20
b) An important consideration in the pricing of products is customers' and competitors' reactions to the firm's selling price. The purpose of considering customers is to ensure that enough demand is generated to cover production cost and make profits. Competitors can wage price wars to discourage new entrants into their markets. Many pricing methods are in use, depending on the prevailing market realities.
Answer:
$29,750
Explanation:
Since the Annual Payments of $53,343 are all equal for the period of 10 years at 8.5% installment note, therefore we Simple interest formula here to calculate the interest amount;
I = Prt
P = Principal Amount = $350,000
r = Interest Rate = 8.5%
t = time = 10-year
I = Interest = 350,000 x 0.085 x 10 = 297,500
Hence, the first annual payment of interest expense will be:
= 297,500 / 10 = $29,750
Low price.discount sale improve market.
