Explain two-part tariff system, Strategic Management

Assignment Help:

Q. Explain Two-part tariff system?

With a two-part tariff system the buyer is charged:

A transfer price equal to the seller's variable (marginal) cost for each unit sold and transferred by the seller.
A fixed charge per period by seller irrespective of the amount of units sold and transferred. The fixed charge should cover the sellers fixed overhead, give an element of profit and the necessary motivation for the seller to supply.

This method is similar in nature to how you are charged for most of your domestic bills.

Related Discussions:- Explain two-part tariff system

Free cash-flow valuations, Q. Free cash-flow valuations? Earnings creat...

Q. Free cash-flow valuations? Earnings create dividends for shareholders. In theory the value of a company is the value of the company's future earnings, discounted at a rate,

Illustrations of internal failure cost, Illustrations of internal failure c...

Illustrations of internal failure cost The internal perspective may control performance by assessment of internal quality failure. Costs incurred before customer has received

Explain shared service centre model, TFX is a multinational company which m...

TFX is a multinational company which manufactures and retails branded designer clothing with business units in a number of different countries globally. Up unless now, each of the

Steps for setting up a maintenance strategy, Question: (a) Briefly elab...

Question: (a) Briefly elaborate on the steps for setting up a maintenance strategy. (b) Failures can be grouped in the following three categories namely Induced, Intermitten

How cost-leadership make use of ict, Question 1: (a) Explain a framewor...

Question 1: (a) Explain a framework for a company to manage its application portfolio. (b) Apply the application portfolio concept to show the different applications for a

How and why has the bcg framework been modified, Question 1: Elaborate ...

Question 1: Elaborate on the following business strategies giving examples, and discuss under what circumstances these business strategies are applied. a) Forward integrati

Determine best strategy, The number of households in a certain community is...

The number of households in a certain community is given by h(t) = 1:26t 2 +7800 households t years after 2001. The proportion (expressed as a decimal) of the households in this s

Calculate the ucl-lcl for the x-bar and range charts, You MUST show all wor...

You MUST show all work! Numbers not supported by work will receive zero credit, even if the answers are correct! Elton Zwilling is the owner of a successful Burger Corral (BC) fran

Define strategic planning, QUESTION Firms often compete with each other...

QUESTION Firms often compete with each other to gain their customers' attention and business. While doing so, each firm tries to chalk out its unique strategy or gameplan. Stra

Theories, what are the theories that can be applied at different levels of ...

what are the theories that can be applied at different levels of a business? i.e. Firm Level, Industry level and global level

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages