Explain the going rate pricing, Managerial Accounting

Assignment Help:

Going rate or follow the crowd pricing:-

In this method the firm price its products at the similar level as that of the competition. This method supposes that there will be no price war within the industry. This is a method commonly used in an oligopolistic market. Despite its benefit of preventing price wars the method suffers from serious limitations. The first is that it is not of necessity true that all firms or the leader firm is operating efficiently. In case it is not, it will mean that the follower firm will also adopt a price level, which reflects the leader's inefficiency rather its own efficiency. Besides it is not always true that a decision taken in collective wisdom is the best if might be certainly not being so from the customer's point of view.


Related Discussions:- Explain the going rate pricing

Management decision making, Decision-making is an integral part of all ...

Decision-making is an integral part of all management functions. It is the process of choosing the among alternative courses of action. Managers have to

State direct material cost standard, State Direct material cost standard ...

State Direct material cost standard The determination of direct material cost standard would involve: a) Determination of quantity standards and b) Determination of pric

C-v-p analysis under uncertainty, C-V-P ANALYSIS UNDER UNCERTAINTY A ma...

C-V-P ANALYSIS UNDER UNCERTAINTY A major limitation of the basic C.V.P analysis is the assumption that the unit variable cost, selling price and the fixed costs are constant an

Prepare an estimation of working capital, Prepare an estimation of working ...

Prepare an estimation of working capital needs from the subsequent information of a trading relates with: (a) Projected Annual Sales 1,00,000

Standard costing in modern environment, Standard costing in modern environm...

Standard costing in modern environment Standard costing has traditionally been associated with labor-intensive operations, but it can be applied to capital-intensive production

Stock-out costs, Stock-out costs These are the opportunity costs of run...

Stock-out costs These are the opportunity costs of running out of stock. They comprise: 1) The costs of lost customer sales, and therefore lost contribution to fixed costs.

Activity –based techniques, Explains how activity –based techniques can be ...

Explains how activity –based techniques can be used to improve performance

Credit evaluation, One of the significant elements of credit management is ...

One of the significant elements of credit management is the assessment of the credit risk of the customer.  As assessing risk two kind of errors arise that are as follows. Type

Determine the scope and areas of cost reduction, Determine the Scope and ar...

Determine the Scope and areas of cost reduction Scope and areas of cost reduction the scope of cost reduction is so wide that it is not practicable to develop fully the areas i

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd