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A product has the following costs.  

                                                         $

Direct materials                           8 

Direct labour                               10 

Variable overheads                     4 

Fixed overheads are $15,000 per month. Budgeted sales per month as 500 units  

What is the profit mark up (the nearest whole percentage) which needs to be added to marginal cost to establish a selling price that will allow the product to breakeven? 

 A company currently sells a product for $60 and at this price, demand is 20,000 units per month. It has been estimated that for every $2 increase or reduction in the price, monthly demand will fall or increase by 1,000 units.  

What is the formula for the demand curve for this product? 

This objective test question contains a question type which will only appear in a computer-based exam, but this question provides valuable practice for all students whichever version of the exam they are taking. 

The following price and demand combinations have been given: 

P1 = 400, Q1 = 5,000 

P2 = 380, Q2 = 5,500 

The variable cost is a constant $80 per unit and fixed costs are $600,000 pa. The optimal price is: 

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【论述题】

Prepare, on a relevant cost basis, the lowest cost estimate that could be used as the basis for a quotation. 

Which of the following conditions must be true for a price discrimination policy to be sensible? 

A

 Buying power of customers must be similar in both market segments 

B

 Goods must not be able to move freely between market segments 

C

 Goods must be able to move freely between market segments 

D

 The demand curves in each market must be the same 

 A product has a prime cost of $12, variable overheads of $3 per unit and fixed overheads of $6 per unit. 

Which pricing policy gives the highest price? 

A

 Prime cost + 80% 

B

 Marginal cost + 60% 

C

 TAC + 20% 

D

Net margin of 14% on selling price 

 If the demand for a product is 5,000 units when the price is $400 and 6,000 units when price is $380, what is the optimal price to be charged in order to maximise profit if the variable cost of the product is $200? 

A

 $150 

B

 $200 

C

 $350 

D

 $700 

The following price and demand combinations have been given: 

P1 = 400, Q1 = 5,000 

P2 = 380, Q2 = 5,500 

The variable cost is a constant $80 per unit and fixed costs are $600,000 pa.  

What is the demand function? 

A

 P = 200 – 0.04Q 

B

 P = 600 – 0.04Q 

C

 P = 600 + 0.04Q 

D

 P = 200 – 20Q