Explain how the decision process in the business market and consumer market differ
What will be an ideal response?
Business buyers usually face more complex buying decisions than do consumer buyers. Business purchases often involve large sums of money, complex technical and economic considerations, and interactions among many people at many levels of the buyer's organization. Because the purchases are more complex, business buyers may take longer to make their decisions and are likely to use a more formalized buying process. In the business buying decision process, the buyer and seller are often much more dependent on each other.
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A friend asks to borrow $55 from you and in return will pay you $58 in one year. If your bank is offering a 6% interest rate on deposits and loans:
a. How much would you have in one year if you deposited the $55 instead? b. How much money could you borrow today if you pay the bank $58 in one year? c. Should you loan the money to your friend or deposit it in the bank?
Cassa Company is a price-taker and uses target pricing
Refer to the following information: Production volume 601,000 units per year Market price $32 per unit Desired operating income 16% of total assets Total assets $13,900,000 Variable cost per unit $20 per unit Fixed cost per year $5,400,000 per year With the current cost structure, Cassa cannot achieve its profit goals. It will have to reduce either the fixed costs or the variable costs. Assuming that fixed costs cannot be reduced, what are the target variable costs per year? Assume all units produced are sold. A) $11,608,000 B) $12,020,000 C) $5,400,000 D) $17,008,000