LOS f: Explain factors that affect industry pricing practices.

Q1. There are at least four factors that contribute to a firm’s profitability and pricing decisions. All of the following are factors that firms consider when establishing their pricing practices EXCEPT:

A)   ease of entry into the industry.

B)   product segmentation.

C)   product demographics.

Q2. Which of the following is NOT a factor that affects industry pricing practices?

A)   Ease of industry entry.

B)   Product segmentation.

C)   Product convexity.

LOS f: Explain factors that affect industry pricing practices. fficeffice" />

Q1. There are at least four factors that contribute to a firm’s profitability and pricing decisions. All of the following are factors that firms consider when establishing their pricing practices EXCEPT:

A)   ease of entry into the industry.

B)   product segmentation.

C)   product demographics.

Correct answer is C)

The four factors that affect industry pricing practices are product segmentation, degree of industry concentration, ease of industry entry, and price changes in key supply inputs.

Q2. Which of the following is NOT a factor that affects industry pricing practices?

A)   Ease of industry entry.

B)   Product segmentation.

C)   Product convexity.

Correct answer is C)

Product convexity is not a factor that affects industry pricing practices. The four factors that affect industry pricing practices include product segmentation, the degree of industry concentration, the ease of industry entry, and price changes in key supply inputs.