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Cos tAc c ount i ng, 15e( Hor ngr en/ Dat ar / Ra j an) Chapt er13 Pr i c i ngDec i s i onsandCos tManagement Obj e c t i ve13. 1 1)Compani e ss houl donl ypr oduc eands e l luni t sa sl ongas___ ___ __ . A)t her ei sc us t ome rde mandf ort hepr oduc t B)t hec ompet i t i onal l owsi t C)t her e venuef r om a na ddi t i onaluni te xc e edst hec os tofpr oduc i ngi t D)t her ei sage ne r ouss uppl yofl owc os tdi r ec tma t e r i al s Ans wer :C Di ff: 2 Obj e c t i ve :1 AACSB:Anal yt i c a lt hi nki ng

2)Toohi ghapr i c ema y_ __ ___ __ . A)de t e rac us t ome rf r om pur c has i ngapr oduc t B)i nc r e as ede mandf ort hepr oduc t C)i ndi c a t es uppl yi st oopl e nt i f ul D)de c r e as eac ompet i t or ' sma r ke ts har e Ans wer :A Di ff: 1 Obj e c t i ve :1 AACSB:Anal yt i c a lt hi nki ng

3)Compani e smus ta l wa yse xami net he i rpr i c i ng_ __ ___ __ . A)ba s e dont hes uppl yoft hepr oduc t B)bas e dont hec os tofpr oduc i ngt hepr oduc t C)t hr ought hee ye soft he i rc us t ome r s D)t hr ought hee ye soft he i rc ompe t i t or s Ans we r :C Di ff: 2 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

4 )Whi c hoft hef ol l o wi ngs t a t e me nt si st r uea boutt hef a c t or st ha ta ffe c tpr i c i ngde c i s i ons ? A)I nf or ma t i ona boutc ompe t i t or s ' t e c hnol ogi e si snotus e f ulf orpr i c i ngde c i s i ons . B)I nf or ma t i ona boutac ompe t i t ori nape r f e c tmar ke ta ffe c t spr i c i ngde c i s i ons . C)I nc r e a s ei npr i c eofas ubs t i t ut epr oduc tdoe snota ffe c tpr i c i ngde c i s i ons . D)Fl uc t ua t i onsi ne x c ha nger a t e sbe t we e ndi ffe r e ntc ount r i e s ' c ur r e nc i e sa ffe c tpr i c i ngde c i s i ons . Ans we r :D Di ff: 3 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

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5 )I nape r f e c t l yc ompe t i t i vema r ke t , whi c hoft hef ol l owi ngi sapr i ma r yf a c t ori nflue nc i ngpr i c i ng de c i s i ons ? A)c os tofpr oduc t i on B)a vai l a bi l i t yofr a w ma t e r i al si nt hema r ke t C)i nf or ma t i ononc ompe t i t or ' sc os ts t r uc t ur e D)va l uec us t ome r spl a c eonpr oduc t Ans we r :D Di ff: 3 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

6 )Whi c hoft hef ol l owi ngs t a t e me nt si st r ueoft hec os tofpr oduc i ngapr oduc t ? A)I tc ont r ol spr i c i ngi nhi ghl yc ompe t i t i vema r ke t s . B)I ta ffe c t st hewi l l i ngne s sofac ompa nyt os uppl yapr oduc t . C)I ti nc l ude sma nuf a c t ur i ngc os t s , butnotpr oduc tde s i gnc os t sf orpr i c i ngde c i s i ons . D)I ti snotaf a c t ort obet a ke ni nt oa c c ountwhi l epr i c i ngapr oduc t . Ans we r :B Di ff: 3 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

7 )I nanonc ompe t i t i vee nvi r onme nt , t heke yf a c t ora ffe c t i ngpr i c i ngde c i s i onsi st he_ __ _ _ _ __ . A)c us t ome r ' swi l l i ngne s st opa y B)pr i c ec ha r ge df ora l t e r na t i vepr oduc t s C)i nf or ma t i ononc ompe t i t or ' sc os ts t r uc t ur e D)mi ni mum pr i c ea c c e pt a bl et ot hefir m Ans we r :A Di ff: 3 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

8 )Whi c hoft hef ol l owi ngs t a t e me nt si st r ueofc os t sandpr i c i ngde c i s i ons ? A)Compa ni e sge tpr ofitf r om s e l l i ngpr oduc t sonl ywhe nt he yar et hepr i c ema ke r s . B)Compani e ss uppl ypr oduc t sasl onga st hepr i c et hec us t ome ri swi l l i ngt opa yf ori t spr oduc t se x c e e ds t hepr i c et ha ti sc ha r ge dbyt hec ompe t i t or . C)Compa ni e ss uppl ypr oduc t sa sl onga st he r ei sade ma ndf ort hepr oduc ti nt hema r ke tr e gar dl e s sof t hepr i c ea twhi c ht hepr oduc t sa r es ol d. D)Compa ni e ss uppl ypr oduc t sa sl onga st her e ve nue sf r om s e l l i ngt hea ddi t i ona luni t se x c e e dt hec os tof pr oduc i ngt he m. Ans we r :D Di ff: 3 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

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9 )Thr e ema j ori nflue nc e sonpr i c i ngde c i s i onsa r e_ __ _ _ _ __ . A)c ompe t i t i on,c os t s , andc us t ome r s B)c ompe t i t i on, de mand, a ndpr oduc t i one ffic i e nc y C)c ont i nuousi mpr ove me nt ,c us t ome rs a t i s f ac t i on, a nds uppl y D)va r i a bl ec os t s ,fix e dc os t s , a ndmi x e dc os t s Ans we r :A Di ff: 1 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

1 0 )Compa ni e smus ta l wa yse xa mi nepr i c i ngde c i s i onst hr ought hee ye soft he i rc r e di t or s . Ans we r :F ALSE Ex pl a na t i on:Compani e smus ta l wa yse xa mi nepr i c i ngde c i s i onst hr ought hee ye soft he i rc us t ome r s . Di ff: 2 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

1 1 )Ac ompa nyope r a t i ngi nape r f e c t l yc ompe t i t i vemar ke tha smor el e e wa yt os e thi ghe rpr i c e st ha na fir mt ha ti samonopol i s t . Ans we r :F ALSE Ex pl a na t i on:Amonopol i s tha snoc ompe t i t or sa ndha smuc hmor el e e wa yt os e thi ghpr i c e st ha nafir m ope r a t i ngi nape r f e c t l yc ompe t i t i vema r ke t . Di ff: 2 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

1 2 )Forac ompanyope r a t i ngi nape r f e c t l yc ompe t i t i vema r ke t ,c os ti nf or ma t i ona ffe c t st hepr i c i ng de c i s i onsoft hec ompa ny . Ans we r :F ALSE Ex pl a na t i on:Forac ompanyope r a t i ngi nape r f e c t l yc ompe t i t i vema r ke t , c os ti nf or ma t i ondoe snota ffe c t t hepr i c i ngde c i s i onoft hec ompany ,i tonl yhe l psmana ge r sde c i det hequant i t yofout putt opr oduc et o ma xi mi z eope r a t i ngi nc ome . Di ff: 3 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

1 3 )Fl uc t ua t i onsi ne x c ha nger a t e sbe t we e ndi ffe r e ntc ount r i e s ' c ur r e nc i e sa ffe c tc os t sa ndpr i c i ng de c i s i onsofac ompa ny . Ans we r :TRUE Di ff: 2 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

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1 4 )I nma r ke t swi t hl i t t l eornoc ompe t i t i on, t heke yf a c t ora ffe c t i ngpr i c ei st hec os tofpr oduc t i ont ot he c ompa ny . Ans we r :F ALSE Ex pl a na t i on:I nma r ke t swi t hl i t t l eornoc ompe t i t i on,t heke yf a c t ora ffe c t i ngpr i c ei st hec us t ome r s ' wi l l i ngne s st opa y , notc os t sorc ompe t i t or s . Di ff: 2 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

1 5 )Asc ompani e si nc r e as es uppl y ,t hec os tofpr oduc i nga na ddi t i ona luni ti ni t i a l l yde c l i ne sbut e ve nt ua l l yi nc r e a s e s . Ans we r :TRUE Di ff: 2 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

1 6 )I fU. Sdol l a rs t r e ngt he nsa gai ns tt heJ a pa ne s eYe n, J a pa ne s epr oduc e r ss e l l i nggoodsi nU. Sma r ke t s wi l lha vet oi nc r e a s et hepr i c e sofpr oduc t st or e c o ve rt hee xt r ac os ta r i s i ngf r om c ur r e nc yfluc t ua t i on. Ans we r :F ALSE Ex pl a na t i on:I fU. Sdol l a rs t r e ngt he nsa ga i ns tJ a pa ne s eYe n,J a pane s epr oduc e r swi l lbea bl et os e l lt he i r goodsa tac he ape rr a t ei nt heU. Sma r ke t sa st he ywi l lnow r e c e i vemor eYe nf ort hes a medol l a ramount ofs a l ea ndhe nc ewi l lbet e mpt e dt or e duc epr i c e s . Di ff: 3 Obj e c t i ve:1 AACSB:Appl i c a t i onofknowl e dge

1 7 )Cl a udi aGe e r , c ont r ol l e r , di s c us s e st hepr i c i ngofane w pr oduc twi t ht hes al e smana ge r , J a me sNol a n. Wha tma j ori nflue nc e smus tCl a udi aa ndJ a me sc ons i de ri npr i c i ngt hene w pr oduc t ?Di s c us se a c hbr i e fly . Ans we r :Thema j ori nflue nc e sar ec us t ome r s , c ompe t i t or s ,a ndc os t s . Cus t o me r s : Ma na ge r smus ta l wa yse x ami nepr i c i ngpr obl e mst hr ought hee ye soft he i rc us t ome r s . A pr i c e i nc r e a s ema yc aus ec us t ome r st or e j e c tac ompany' spr oduc ta ndc hoos eac ompe t i ngors ubs t i t ut e pr oduc t . Co mp e t i t o r s : Compe t i t or s ' r e a c t i onsi nflue nc epr i c i ngde c i s i ons .Atonee xt r e me ,ar i va l ' spr i c e sa nd pr oduc t sma yf or c eabus i ne s st ol owe ri t spr i c e st obec ompe t i t i ve .Att heot he re xt r e me ,abus i ne s s wi t houtar i va li nagi ve ns i t ua t i onc a ns e thi ghe rpr i c e s . A bus i ne s swi t hknowl e dgeofi t sr i va l s ' t e c hnol ogy ,pl a ntc a pa c i t y ,a ndope r a t i ngpol i c i e si sa bl et oe s t i ma t ei t sr i va l s ' c os t s , whi c hi sva l ua bl e i nf or ma t i oni ns e t t i ngc ompe t i t i vepr i c e s . Co s t s : Compani e spr i c epr oduc t st oe x c e e dt hec os t sofmaki ngt he m. Thes t udyofc os t be ha vi orpa t t e r ns gi ve si ns i ghti nt ot hei nc omet ha tr e s ul t sf r om di ffe r e ntc ombi na t i onsofpr i c ea ndout putqua nt i t i e ss ol d f orapa r t i c ul arpr oduc t . Di ff: 2 Obj e c t i ve:1 AACSB:Anal yt i c alt hi nki ng

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Obj e c t i ve1 3. 2 1 )Shor t t e r m pr i c i ngde c i s i ons_ _ _ __ _ _ _. A)us ec os t st ha tma ybei r r e l e va ntf orl ongt e r m pr i c i ngde c i s i ons B)ar emor eoppor t uni s t i c C)t e ndt ode c r e a s epr i c e swhe nde ma ndi ss t r ong D)ha veat i mehor i z onofmor et ha noneye a r Ans we r :B Di ff: 2 Obj e c t i ve:2 AACSB:Anal yt i c alt hi nki ng

2 )Long r unpr i c i ngde c i s i ons_ __ _ _ _ __ . A)ha veat i mehor i z onofl e s st ha noneye a r B)i nc l udea dj us t i ngpr oduc tmi xi nac ompe t i t i vee nvi r onme nt C)a nds hor t r unpr i c i ngde c i s i onsge ne r a l l yha vet hes a mer e l e va ntc os t s D)us epr i c e st ha ti nc l udear e a s ona bl er e t ur noni nve s t me nt Ans we r :D Di ff: 2 Obj e c t i ve:2 AACSB:Anal yt i c alt hi nki ng

3 )Whi c hoft hef ol l owi ngi st r ueofl ong r unpr i c i ng ? A)I ti sfix e da tal e ve lt ha tr e c ove r st heva r i a bl ec os toft hec ompa nyandapr e de t e r mi ne dpr ofitma r kup. B)I ti sge ne r a l l yaf unc t i onoft hema r ke tf a c t or sandt hec os ti nvol ve di npr oduc t i oni sge ne r a l l ynota c ons i de r a t i on. C)I ti sas t r a t e gi cde c i s i onde s i gne dt obui l dl ongr unr e l a t i ons hi pswi t hc us t ome r sba s e dons t a bl ea nd pr e di c t a bl epr i c e s . D)I ti sba s e donl yoni nt e r na lr e qui r e me nt sl i kec os tande s t i ma t e dr a t eofr e t ur na si nt hel ongr unt he s e r e qui r e me nt sa r et hedr i vi ngf a c t or sofa nyor ga ni z a t i on. Ans we r :C Di ff: 3 Obj e c t i ve:2 AACSB:Anal yt i c alt hi nki ng

4 )Forl ongr unpr i c i ngde c i s i ons , us i ngs t a bl epr i c e sha st hea dvant a geof_ _ _ __ _ _ _ . A)mi ni mi zi ngt hene e dt omoni t orc ompe t i t or ' spr i c e sf r e que nt l y B)r e duc i ngt hene e dt oc ha ngec os ts t r uc t ur e sf r e que nt l y C)r e duc i ngc ompe t i t i on D)he l pi ngt obui l dbuye r s e l l e rr e l a t i ons hi ps Ans we r :D Di ff: 1 Obj e c t i ve:2 AACSB:Anal yt i c alt hi nki ng

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5 )Pur pl eTr e e sma nuf a c t ur e sr us t i cf ur ni t ur e .Thec os ta c c ount i ngs ys t e me s t i ma t e smanuf a c t ur i ngc os t s t obe$ 2 40pe rt a bl e ,c ons i s t i ngof6 0 % var i a bl ec os t sa nd4 0% fix e dc os t s . Thec ompanyha ss ur pl us c a pac i t ya va i l a bl e .I ti sPur pl eTr e e s ' pol i c yt oa dda7 5 % ma r kupt of ul lc os t s . Al a r gehot e lc ha i ni sc ur r e nt l ye x pa ndi nga ndha sde c i de dt ode c or a t ea l lne w hot e l sus i ngt her us t i c s t yl e .Pur pl eTr e e si si nvi t e dt os ubmi tabi dt ot hehot e lc ha i n. Wha tpe runi tpr i c ewi l lPur pl eTr e e smos t l i ke l ybi dont hi sl ongt e r m or de r ? A)$ 1 6 8pe runi t B)$1 8 0pe runi t C)$ 2 5 2pe runi t D)$ 4 2 0pe runi t Ans we r :D Ex pl a na t i on:D)Mos tl i ke l ype runi tbi d=$ 2 4 0+( $ 2 40×7 5 %)=$4 2 0 . Di ff: 2 Obj e c t i ve:2 AACSB:Appl i c a t i onofknowl e dge

6 )Zol a s ' He a t e r si sa ppr oac he dbyMs . Le i l a , ane wc us t ome r , t of ul fil lal ar geone t i me onl ys pe c i a lor de r f orapr oduc ts i mi l a rt ooneoffe r e dt or e gul a rc us t ome r s . Zol a s ' He a t e r sha se x c e s sc a pa c i t y .Thef ol l owi ng pe runi tda t aa ppl yf ors a l e st or e gul a rc us t ome r s : Di r e c tma t e r i al s Di r e c tma nuf ac t ur i ngl a bor Va r i abl ema nuf a c t ur i ngs uppor t Fi x e dma nuf a c t ur i ngs uppor t Tot a lma nuf a c t ur i ngc os t s Ma r kup( 2 0 % oft ot a lma nuf ac t ur i ngc os t s ) Es t i ma t e ds e l l i ngpr i c e

$ 4 0 0 1 2 0 6 0 2 0 0 7 8 0 1 5 6 $ 9 3 6

I fMs . Le i l awa nt e dal ongt e r mc ommi t me nt ,a ndnotaone t i me s pe c i a lor de r , f ors uppl yi ngt hi spr oduc t , c a l c ul a t et hemos tl i ke l ypr i c et obequot e da s s umi ngt hema r kupr e ma i nss a me ? A)$ 7 8 0 B)$5 8 0 C)$ 5 2 0 D)$ 9 3 6 Ans we r :D Ex pl a na t i on:D)Mos tl i ke l yl ongt e r m pr i c e=$9 3 6 . Di ff: 2 Obj e c t i ve:2 AACSB:Appl i c a t i onofknowl e dge

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7 )Gol de nGe ne r a t orSuppl yi sa ppr oa c he dbyMr . St e phe n, ane wc us t ome r , t of ul fil lal a r geone t i me onl ys pe c i alor de rf orapr oduc ts i mi l a rt ooneoffe r e dt or e gul a rc us t ome r s . Gol de nGe ne r a t orSuppl yha s e x c e s sc a pa c i t y . Thef ol l o wi ngpe runi tda t aa ppl yf ors a l e st or e gul arc us t ome r s : Di r e c tma t e r i al s $ 1 , 7 00 . 0 0 Di r e c tma nuf ac t ur i ngl a bor 1 0 0 . 00 Va r i abl ema nuf a c t ur i ngs uppor t 2 0 0 . 00 Fi x e dma nuf a c t ur i ngs uppor t 1 5 0 . 00 Tot a lma nuf a c t ur i ngc os t s 2 , 1 5 0. 0 0 Ma r kup( 3 0 % oft ot a lma nuf ac t ur i ngc os t s ) 6 4 5 . 00 Es t i ma t e ds e l l i ngpr i c e $ 2 , 7 95 . 0 0 I fMr . S t e phe nwa nt e dal ongt e r mc ommi t me nt ,a ndnotaone t i me onl ys pe c i a lor de r , f ors uppl yi ngt hi s pr oduc t , c a l c ul a t et hemos tl i ke l ypr i c et obequot e das s umi ngt hemar kupr e ma i nss a me ? A)$ 2 , 00 0 B)$2 , 1 5 0 C)$ 2 , 79 5 D)$ 2 , 80 0 Ans we r :C Ex pl a na t i on:C)Mos tl i ke l yl ongt e r m pr i c e=$ 2 , 7 95 . Di ff: 2 Obj e c t i ve:2 AACSB:Appl i c a t i onofknowl e dge

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8 )Gr a c i usMa nuf a c t ur i ngi sa ppr oac he dbyaEur ope a nc us t ome rt of ul fil laone t i me onl ys pe c i a lor de r f orapr oduc ts i mi l a rt ooneoffe r e dt odome s t i cc us t ome r s .Gr a c i usMa nuf a c t ur i nghasapol i c yofa ddi ng a1 0 % ma r kupt of ul lc os t sa ndc ur r e nt l yha se x c e s sc a pa c i t y .Thef ol l owi ngpe runi tda t aa ppl yf ors a l e st o r e gul a rc us t ome r s : Va r i a b l ec o s t s : Di r e c tma t e r i al s Di r e c tl a bor Ma nuf a c t ur i ngove r he a d Ma r ke t i ngc os t s Fi x e dc o s t s : Ma nuf a c t ur i ngove r he a d Ma r ke t i ngc os t s Tot a lc os t s Ma r kup( 1 0 % oft ot a lc os t s ) Es t i ma t e ds e l l i ngpr i c e

$ 3 0 1 0 2 0 1 0 1 0 0 2 0 1 9 0 1 9 $ 2 0 9

I ft heEur ope a nc us t ome rwa nt e dal ongt e r mc ommi t me nt , andnotaone t i me onl ys pe c i alor de r , f or s uppl yi ngt hi spr oduc t , c al c ul a t et hemos tl i ke l ypr i c et obequot e das s umi ngt hemar kupr e ma i nss a me ? A)$ 7 0 . 0 0 B)$1 9 0 . 00 C)$ 2 0 9. 0 0 D)$ 2 3 9. 0 0 Ans we r :C Ex pl a na t i on:C)Mos tl i ke l yl ongt e r m pr i c e=$ 2 0 9 . Di ff: 2 Obj e c t i ve:2 AACSB:Appl i c a t i onofknowl e dge

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9 )Gr ounde dCoffe ePr oduc t sma nuf a c t ur e sc offe et a bl e s .Gr ounde dCoffe ePr oduc t sha sapol i c yof a ddi nga2 0 % ma r kupt of ul lc os t sa ndc ur r e nt l yha se x c e s sc apac i t y .Thef ol l owi ngi nf or ma t i onpe r t ai ns t ot hec ompany' snor ma lope r a t i onspe rmont h: Out putuni t s Ma c hi ne hour s Di r e c tma nuf ac t ur i ngl a bor hour s Di r e c tma t e r i al spe runi t Di r e c tma nuf ac t ur i ngl a borpe rhour Va r i abl ema nuf a c t ur i ngove r he a dc os t s Fi x e dma nuf a c t ur i ngove r he a dc os t s Pr oduc ta ndpr oc e s sde s i gnc os t s Ma r ke t i nga nddi s t r i but i onc os t s

2 0 , 0 00 t a bl e s 8 , 0 0 0 hour s 1 0 , 00 0 hour s $ 1 0 5 $ 1 0 $ 3 2 2 , 5 0 0 $1 , 2 0 0, 0 0 0 $ 1 , 1 00 , 0 0 0 $ 1 , 1 25 , 0 0 0

Forl ongr unpr i c i ngoft hec offe et a bl e s , wha tpr i c ewi l lmos tl i ke l ybeus e dbyGr ounde dCoffe e ? A)$ 1 3 4. 7 6 B)$1 6 1 . 70 C)$ 2 2 2. 2 5 D)$ 2 6 6. 7 0 Ans we r :D Ex pl a na t i on:D) Di r e c tma t e r i al s$ 10 0×1 , 0 00 $1 0 0, 0 0 0 Di r e c tma nuf ac t ur i ngl a bor$ 1 2×1 0, 0 0 0 /3 0 , 00 0×1 , 00 0 4 , 0 0 0 Va r i abl ema nuf a c t ur i ng( $ 3 2 2, 5 0 0 /3 0 , 0 0 0 )×1 , 00 0 1 0 , 7 50 Fi x e dma nuf a c t ur i ng( $ 1, 2 0 0 , 0 0 0 /3 0 , 00 0 )×1 , 0 00 4 0 , 0 00 Pr oduc ta ndpr oc e s sde s i gnc os t s( $ 9 00 , 0 0 0 /3 0 , 00 0 )×1 , 0 00 3 0 , 0 00 Ma r ke t i nga nddi s t r i but i on( $ 1, 2 5 0 , 0 0 0 /3 0 , 0 0 0 )×1 , 00 0 3 7 , 5 00 Ful lc os tpe runi t 2 2 2 , 2 5 0 Ma r kup( 2 0 %) 4 4 , 4 50 Es t i ma t e ds e l l i ngpr i c e $ 2 6 6 , 7 0 0 $ 2 6 6 , 7 0 0 /1 0 0 0=$ 26 6 . 70 Di ff: 3 Obj e c t i ve:2 AACSB:Appl i c a t i onofknowl e dge

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1 0 )Qui c kConne c tma nuf ac t ur e shi ght e c hc e l lphone s . Qui c kConne c tha sapol i c yofaddi nga2 0% ma r kupt of ul lc os t sa ndc ur r e nt l yha se x c e s sc apac i t y .Thef ol l o wi ngi nf or ma t i onpe r t ai nst ot he c ompa ny' snor ma lope r a t i onspe rmont h: Out putuni t s 1 , 2 5 0 phone s Ma c hi ne hour s 7 5 0 hour s Di r e c tma nuf ac t ur i ngl a bor hour s 7 0 0 hour s Di r e c tma t e r i al spe runi t Di r e c tma nuf ac t ur i ngl a borpe rhour Va r i abl ema nuf a c t ur i ngove r he a dc os t s Fi x e dma nuf a c t ur i ngove r he a dc os t s Pr oduc ta ndpr oc e s sde s i gnc os t s Ma r ke t i nga nddi s t r i but i onc os t s

$ 2 0 $ 8 $ 1 7 5 , 0 0 0 . 00 $ 1 2 6 , 3 0 0 $ 1 4 3 , 0 0 0 $ 1 5 3 , 6 4 5

Forl ongr unpr i c i ngoft hec e l lphone s ,wha tpr i c ewi l lmos tl i ke l ybeus e db yQui c kConne c t ? A)$ 9 5 . 0 0 B)$1 3 5 . 00 C)$ 1 7 5. 0 0 D)$ 2 1 0. 0 0 Ans we r :D Ex pl a na t i on:D) Di r e c tma t e r i al s $2 5 . 0 0 Di r e c tma nuf ac t ur i ngl a bor( $ 15×5 , 00 0 ) /1 0, 0 0 0 7 . 5 0 Va r i abl ema nuf a c t ur i ng( $ 1 7 5, 0 0 0 /1 0 , 0 0 0 ) 1 7 . 5 0 Fi x e dma nuf a c t ur i ng( $ 42 5 , 0 00 /1 0 , 0 0 0) 4 2 . 5 0 Pr oduc ta ndpr oc e s sde s i gnc os t s( $ 4 00 , 0 0 0 /1 0 , 00 0 ) 4 0 . 0 0 Ma r ke t i nga nddi s t r i but i on( $ 42 5 , 0 00 /1 0 , 0 00 ) 42 . 50 Ful lc os tpe runi t 1 7 5 . 00 Ma r kup( 3 0 %) 3 5. 00 Es t i ma t e ds e l l i ngpr i c e $ 2 1 0. 0 0 Di ff: 3 Obj e c t i ve:2 AACSB:Appl i c a t i onofknowl e dge

1 1 )Whi c honeoft hef ol l owi nga c t i vi t i e swoul dmos tl i ke l ybec ons i de r e dal ongr unpr i c i ngde c i s i on? A)one t i me onl ys pe c i a lor de rpr i c i ng B)pr oduc tmi xa dj us t me nt si nac ompe t i t i vemar ke t C)s e t t i ngpr i c e st oge ne r a t ear e a s ona bl er a t eofr e t ur noni nve s t me nt D)c ha ngi ngpr i c e si nr e s pons et owe a kde ma nd Ans we r :C Di ff: 2 Obj e c t i ve:2 AACSB:Anal yt i c alt hi nki ng

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1 2 )Shor t r unpr i c e ss houl da tl e as tr e c ove r_ _ _ _ __ _ _ . A)f ul lc os tofpr oduc i ngapr oduc t B)fix e dma nuf a c t ur i ngove r he ad C)va r i a bl ec os tofpr oduc i ngapr oduc t D)va r i a bl eandfix e dma nuf a c t ur i ngove r he ad Ans we r :C Di ff: 3 Obj e c t i ve:2 AACSB:Anal yt i c alt hi nki ng

1 3 )Whi c hoft hef ol l owi ngi sr e gar de da sapur pos eofc os tal l oc a t i on? A)I the l psi ni de nt i f yi ngt hepot e nt i alc us t ome r sf orapr oduc t . B)I tpr o vi de st hepr ofitma r gi ne ar ne d. C)I the l psi nma i nt a i ni ngde c or um a mongma na ge r s . D)I tpr ovi de si nf or ma t i onf ore c onomi cde c i s i ons . Ans we r :D Di ff: 2 Obj e c t i ve:2 AACSB:Anal yt i c alt hi nki...