Answer:
Price ceiling
Explanation:
The price ceiling means the maximum price that is charged by the supplier to the consumer. If is not affected so it is above equilibrium price and in case when it is below than the demand is greater than the supply.
So in the given question, it is mentioned that the prices of food are set low that are sufficient to meet the requirement represent the price ceiling example
Which is an argument against the use of the ability-to-pay principal of taxation? (Select 1) It is difficult to determine who receives benefits from government spending. People are not willing to pay unless they receive something in return. People who earn more money have benefitted more from society. It reduces the incentive to work hard and take risks to succeed.
Answer:
It reduces the incentive to work hard and take risks to succeed
Explanation:
The argument against the use of the ability-to-pay principal of taxation is that It reduces the incentive to work hard and make more money and take risks to succeed .
Although Ability to pay principal of taxation believe that a person or an individual tax should depend on what the tax will tend to create to such individual when compared to the wealth of that individual, but many people argue that there should be equity , meaning everybody should pay the same tax rate in such a way that a person or an individual tax rate should not be higher or lesser than another person tax rate.
The Environmental Protection Agency is attempting to rule on whether pollution from greenhouse gas emissions endangers public safety. Among the many greenhouse gas polluters are cows emitting methane. Economists have devised a theory to help address this issue. Identify the statement that is true according to economic theory
Answer:
The interpretation of that same particular question is demonstrated in the following segment on the response.
Explanation:
The economic analysis seems to be a theoretical construct for something like the interpretation and analysis of containerized cargo in such an economy.The effective level of emissions elimination exists where even the potential profit of removing exposure is equivalent to the marginal price of removing emission (several other contaminations may be authorized).
Two companies report the same cost of goods available for sale but each employs a different inventory costing method. If the price of goods has increased during the period then the company using:______
a. LIFO will have the highest ending inventory
b. FIFO will have the highest cost of good sold
c. FIFO will have the highest ending inventory
d. LIFO will have the lowest cost of goods sold
Answer:
c. FIFO will have the highest ending inventory
Explanation:
FIFO means first in, first out. it means it is the first purchased inventory that is the first to be sold.
LIFO means last in first out. it means that it is the last purchased inventory that is the first to be sold.
If FIFO inventory method is used, the first purchased inventory is the first to be sold and price increased during the period, the beginning inventory would be lower and the ending inventory would be higher when compared to a company using LIFO
A sunk cost can best be described as: Group of answer choices a cost that has already been incurred and cannot be removed. a form of financing cost. the cash flows of a new project that come at the expense of existing projects. an important cost to include in the capital budgeting process. the same thing as an opportunity cost
Answer:
Sunk Cost
A sunk cost can best be described as:
a cost that has already been incurred and cannot be removed.
Explanation:
A sunk cost for Manufacturer X is a cost that has already been incurred. It is irrelevant for any future decision making because it cannot be recovered or removed. By its nature, a sunk cost is a fixed cost. For example, the costs of purchasing an item of equipment, building an office building, and other noncurrent expenditure are sunk costs . If management is making decisions based on differential or incremental costing, such sunk costs are not considered.
Which of the following is a cloud computing element that gives a service provider the ability to dynamically allocate shared physical resources to multiple customers based on each customer's usage demand?
A. On-demand.
B. Resource pooling.
C. Measured Service.
D. Rapid Elasticity.
Answer:
B. Resource pooling.
Explanation:
-On-demand means that clients can get the service when and where they need it.
-Resource pooling refers to grouping resources to provide the service to different customers in a way in which the resources are assigned according to the demand of each client.
-Measured Service is when a company monitors the service that is providing for different purposes like billing.
-Rapid Elasticity is the ability that the company providing the service has to modify the resources according to the demand.
According to the definitions, the answer is that the cloud computing element that gives a service provider the ability to dynamically allocate shared physical resources to multiple customers based on each customer's usage demand is resource pooling.
A parent company is a company that ________. A. has any level of investment in another company B. is controlled by another corporation C. is the first to begin operations in an industry D. owns a controlling interest in another company
If a bank receives a $1 million discount loan from the Federal Reserve, then the bank's reserves will:_____.
a. increase by $1 million.
b. not change.
c. increase by less than $1 million.
d. increase by more than $1 million.
Answer:
increase by more than $1 million
In the principal-agent relationship, the agent is:__________.
A) the person who places his resources in professional hands in exchange for the professional's promise to act on the resource owner's behalf.
B) the owner of a resource that has hired another party to act on his behalf.
C) the person who is placed in control over resources that are not his own and agrees to compensate the resource owner in the event of outcomes that do not satisfy the resource owner.
D) the person who is placed in control over resources that are not his own, with a contractual obligation to use these resources in the interests of some other party.
Answer: A) the person who is placed in control over resources that are not his own with a contractual obligation to use these resources in the interests of some other party.
Explanation:
Principal-agent relationship is
a legal arrangement in which one party appoints another party to act on its behalf.The agent acts on behalf of the principal and have to follow all the instruction provided by the principal.So, In the principal-agent relationship, the agent is the person who places his resources in professional hands in exchange for the professional's promise to act on the resource owner's behalf.
Hence, the correct option is (A).
Convergence theory states that collective action occurs when: Group of answer choices strategic planning is done people with similar ideas gather in the same place the setting is right all of the above
Answer: people with similar ideas gather in the same place.
Explanation:
According to the convergence theory, like minded people or economies are always together and gather in the same place. It is the assumption that over time, the group members will be more alike and have the same behavior.
In an organization, it can be referred to as company culture because the employees typically have identical behavios, characteristics, and philosophies.
Sematech is a producer of computer chips. To gain an advantage over other computer chip makers, Sematech focuses on reducing its costs below all of its competitors and has aligned its value chain accordingly. Recently, several of Sematech's competitors have begun to reduce the company's competitive advantage. In response to this threat, Sematech has decided to add production capacity in an effort to lower costs.
Sematech is pursuing which strategy?
A) cost-leadership business strategy
B) product-differentiation business strategy
C) cost-leadership corporate strategy
D) product-differentiation corporate strategy
Answer: A) cost-leadership business strategy
Explanation:
Cost leadership business strategy is a
strategy of getting a competitive advantage by having the lowest cost of operation in the entire industry. makes a reasonable profit on each sale because you've reduced costs.Here, To gain an advantage over other computer chip makers, Sematech focuses on reducing its costs below all of its competitors .
where as product differentiation is a technique use to differentiate a product from similar offerings on the market.
So, Sematech is pursuing a cost-leadership business strategy.
So, correct option is (A).
Sematech is pursuing the cost-leadership business strategy.
What is Cost leadership business strategy?Cost leadership business strategy is a strategy of having low operating costs across the industry, make a good profit on every sale because you reduce costs.
Here, In order to make more profit than other chipmakers, Sematech focuses on lowering its costs below all of its competitors.
Whereas product classification is the process of distinguishing a product from the same products on the market.
Therefore, Sematech pursues a cost-leadership business strategy. Option A is the correct answer.
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If the Fed increases the discount rate, which of the following accurately describes the system, finally leading to a decline in money supply?
A. Excess reserves j: Reserves: Coans J: Deposits : Money supply
B. Reserves J: Excess reserves J: Loans J: Deposits ;Money supply
C LoansJ:DepositsJ:Reserves J:Excess reserves |: Money supply
D. Deposits J: ReservesJ:Excess reservesI:Loans J:Money'supply
Answer:
B
Explanation:
Reserves J: Excess reserves J: Loans J: Deposits ;Money supply
One problem in the interstate trucking industry is the number of trucks that return after making a delivery with an empty truck. There is a website where independent interstate truckers can look for loads that they can carry with them on their return trip. Because the trucks would be returning empty (and inefficiently), truckers who use this website to get business that they would not have had without it and charge a reduced shipping rate. This reduced rate is an example of:
Answer:
Yield management pricing.
Explanation:
One problem in the interstate trucking industry is the number of trucks that return after making a delivery with an empty truck. However, there is a website where independent interstate truckers can look for loads that they can carry with them on their return trip. Because the trucks would be returning empty (and inefficiently), truckers who use this website to get business that they would not have had without it and charge a reduced shipping rate. This reduced rate is an example of yield management pricing.
Yield management pricing can be defined as a pricing strategy which typically involves having a variety of charges (prices) for the services being provided by an organization at a specific period of time.
Simply stated, it basically involves providing a service at the right price, time and to the right service taker.
The yield management pricing strategy is mostly used by the airline, hotel, travel businesses. The main purpose of the yield management pricing is to maximize profits or generate more revenue.
The 2012 box office receipts for the movie The Avengers were $1,515.8 million. By way of comparison, the 1977 receipts for Star Wars were $798.0 million. If the Consumer Price Index was 60.6 in 1977 and 229.6 in 2012, which of the following is true?
a. The real receipts of The Avengers were almost four times greater than those for Star Wars.
b. The real receipts of Star Wars were nearly two times greater than those for The Avengers.
c. The real receipts of The Avengers were one-third of those for Star Wars.
d. The real receipts of Star Wars were about 33 percent greater than those for The Avengers.
Answer: b. The real receipts of Star Wars were nearly two times greater than those for The Avengers.
Explanation:
Real reciept = (Dollar amount) ×( Ending-period CPI) ÷ (Beginning-period CPI)
Here, Receipt for Avengers in 2012 = $1,515.8 million
Receipt for Star wars in 1977 = $798.0 million
CPI in 2012 = 229.6
CPI in 1977 = 606
Now, Real receipt of Star wars in 2012 = $((798.0) × (229.6) ÷ 60.6)
=$ 3023.45 ≈ Twice of receipt for Avengers in 2012.
[Twice of receipt for Avengers in 2012 = $3031.6]
Hence, the correct statement is b."The real receipts of Star Wars were nearly two times greater than those for The Avengers."
In Appellia, it takes 10 units of resources to increase its output of sugar from 12 tons to 13 tons, but 11 units of resources to increase output from 13 tons to 14 tons, and 12 units of resources to increase output from 14 tons and 15 tons, and so on. The need for increasing resources is an example of
Answer:
diminishing returns to specialization
Explanation:
The law of diminising returns states that with each additional unit of input used in the production process, there will be a point at which additional unit of input will result in less output. Marginal output starts to decrease.
In the given scenario it takes 10 units of resources to increase its output of sugar from 12 tons to 13 tons, but 11 units of resources to increase output from 13 tons to 14 tons, and 12 units of resources to increase output from 14 tons and 15 tons.
There is need of 10 units of input to increase one unit of output, then we need 11 units to do the same, and finally 12 units to increase output by 1.
This is an example of how input increase loses efficacy and it is an example of diminishing returns to specialization.
19,250.00 pounds of material were purchased at a cost of $2.40 per pound. All of the material purchased was used to produce 2,500 units of Zoom. 450 hours of direct labor time were recorded at a total labor cost of $4,500. Required: 1. Compute the materials price and quantity variances for the month. 2. Compute the labor rate and efficiency variances for the month.
Answer:
Direct material price variance = $3,850 (Favorable)
Direct material quantity variance = $5,200 (Unfavorable)
Direct Labor rate variance = $1,350 (Unfavorable)
Direct labor efficiency variance = $2,100 (Favorable)
Explanation:
Note: Question is incomplete. However, the missing part is as follows
"Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:
Standard Quantity Standard Price Standard Cost
or Hours or Rate
Direct materials 6.90 pounds $ 2.60 per pounds $17.94
Direct labor 0.30 hours $ 7.00 per hour $2.10
During the most recent month, the following activity was recorded: a. "
Solution
1. Direct material price variance = Standard price - Actual price ) * Actual quantity purchased
= (2.60 - 2.40) * 19,250
= $3,850 (Favorable)
Direct material quantity variance= Standard quantity - Actual quantity * Standard Rate
= (2,500 * 6.90 - 19,250) * 2.60
= (17,250 - 19,250) * 2.60
= -2000 * 2.60
= $5,200 (Unfavorable)
2. Direct Labor rate variance = (Standard rate - Actual rate) * Actual hours
Actual rate = 4,500 / 450 = 10
Direct Labor rate variance = (7 - 10 ) * 450
= -3 * 450
= $1,350 (Unfavorable)
Direct labor efficiency variance= (Standard hours - Actual hours) * Standard rate
= (2,500 * 0.3 - 450) * 7
= (750 - 450 ) * 7
= 300 * 7
= $2,100 (Favorable)
Don and Susanne have both been accused of insider trading. Don knows that if he confesses while Susanne keeps silent, he will receive a 1-month jail sentence. He also knows that if Susanne confesses and he keeps silent, he will receive a 12-month jail sentence. If neither of them confesses, there will be insufficient evidence to convict either of insider trading, but there is enough evidence to convict each of them individually of obstructing justice, which carries a 2-month sentence. If both of them confess, they will both serve a 3-month jail sentence. This situation is:
Answer:
The situation described in the question is referred to as the Prisoner's Dilemma.
Explanation:
The prisoner's dilemma is an example of a situation in Game Theory.
Game Theory is a subject which can be found under behavioural economics with strong roots in psychology. It is related to the science of decision making in by people and how those decisions affect others. In the simplest of cases, just as is given in the question, the dynamics is between two individuals.
According to the theory, sometimes an equilibrium is reached. This point refers to point in a game or a scenario where the decision by the two individuals is firmed up and as a result, the consequences of such determined.
If the decision by each player is such that it can no longer be changed by any of the players in order to improve their benefits accruable, such decisions are referred to as the Nash Equilibrium.
Cheers!
"Tina withdraws $20,000 from her money market account to start up her own house cleaning business. Over that time, the account would have earned 3 percent interest. In order to properly account for all costs of her business, Tina must not forget:"
Answer: the opportunity cost of $600
Explanation:
From the question, we are informed that Tina withdraws $20,000 from her money market account to start up her own house cleaning business and that over that time, the account would have earned 3 percent interest.
In order to properly account for all costs of her business, Tina must not forget the opportunity cost of $600. This is calculated as 3% of $20,000.
The opportunity cost is what Time had to forgoes in order to start her business.
A river barge company can offer cheaper, although slower, per-pound transportation of products to companies when compared with transportation by air, truck, or rail. The river barge company should first target customers whose companies use:
Answer:
the cost leadership strategy.
Explanation:
A river barge company can offer cheaper, although slower, per-pound transportation of products to companies when compared with transportation by air, truck, or rail. The river barge company should first target customers whose companies use the cost leadership strategy.
A cost leadership strategy is a business strategy which is aimed at using the lowest cost of production and operation in a business.
Hence, river barge company cheaper, although slower, per-pound transportation as against the use of air, truck, or rail which would be more expensive.
By expressing concern for subordinates and representing their best interests in day-to-day activities, a manager demonstrates a(n) _______ behavior in the context of path–goal theory. directive supportive task-oriented achievement-oriented structural
Answer:
supportive
Explanation:
A supportive leader or manager according to the path-goal theory first introduced by Robert House is one that shows genuine concern for subordinates, while also representing their best interests in day-to-day activities.
By so doing, the manger, according to the path-theory would motivate and improve the performance of his subordinates.
The statement made by Lynn Turner, former SEC chief accountant, "Are the auditors going to serve management, or are they going to serve the best interests of the investing public?", refers to concerns about:
Answer:
The correct answer is "Conflict between professionalism and commercialism".
Explanation:
As a professional service rather than partnership presents a condition that may impede the implementation including its independent review-this statement generates possible interest confliction as the impairment of the conclusion of the investigation contributes to the violation of conduct.A professional service produces a condition that may well compromise impartial judgment - The journalistic integrity of an external auditor should not be compromised according to the standard prohibition claim. This can then cause friction.So that the given statement refers to the above solution.
Eve Cosmetics Company consists of two departments, Blending and Filling. The Filling Department received 50,000 ounces from the Blending Department. During the period, the Filling Department completed 46,000 ounces, including 4,000 ounces of work in process at the beginning of the period. The ending work in process inventory was 8,000 ounces. How many ounces were started and completed during the period?
Answer:
The number of ounces started and completed during the period is 42,000 ounces.
Explanation:
The number of ounces started and completed during the period can be computed by simply deducting the beginning work in process from the number of ounces completed.
Since we have the following from the question:
Number of ounces completed by Filling = 46,000 ounces
Beginning work in process = 4,000 ounces
Therefore, we have:
Number of ounces started and completed = Number of ounces completed by Filling - Beginning work in process = 46,000 ounces - 4,000 ounces = 42,000 ounces
Therefore, the number of ounces started and completed during the period is 42,000 ounces.
High and unexpected inflation has a greater cost Group of answer choices for savers in low income tax brackets than for savers in high income tax brackets. for those who hold a little money than for those who hold a lot of money. for those whose wages increase by as much as inflation than those who are paid a fixed nominal wage. for those who save than for those who borrow.
Answer:
for those who save than for those who borrow.
Explanation:
Inflation is a persistent rise in general price levels
inflation is unexpected if it is unanticipated and not factored in to factors such as interest rate.
savers are at a disadvantage when there is high and unexpected inflation because the value of savings would fall fast.
while borrowers are at an advantage because they repay less in value than what what they borrowed
If people's expectations of inflation are formed rationally rather than based on adaptive expectations and if policymakers make a credible policy move to reduce inflation, then the costs of reducing inflation will be ______ traditional estimates of the sacrifice ratio. Group of answer choices
Correct/Complete Question:
If people's expectations of inflation are formed rationally rather than based on adaptive expectations and if policymakers make a credible policy move to reduce inflation, then the costs of reducing inflation will be ______ traditional estimates of the sacrifice ratio.
A) much higher than
B) much lower than
C) exactly equal to
D) approximately two percent greater than
Answer:
B, much lower than
Explanation:
Inflation can be defined as the continuous increase in price of goods and services over a period of time.
Inflation can as much as possible affect the economy of a country or state, etc. This is because if policy makers listen to the rationally formed expectations and opinions of the people to make reduce inflation, it will be much lesser compared to the traditional estimates of the sacrifice ratio.
Cheers.
Ben quit his job as an economics professor to become a golf professional. He gave up his $30,000 salary and invested his retirement fund of $50,000 (which was earning 10 percent interest) in this venture. After all expenses, his net winnings were $35,000. Ben's economic profits were
Answer:
Economic profit = $0
Explanation:
Economic profit = Revenue - Opportunity cost
Economic profit = $35,000 - (30,000 + (10% x 50,000))
Economic profit = $35,000 - $35,000
Economic profit = $0
Economic profit can be calculated by deducting the opportunity cost from the revenue earned. Here the economic profit is $0 as Ben lost his salary of $30,000 and the interest on retirement fund just for $35,000 revenue.
The economic profit is zero.
Important information:He gave up his $30,000 salary and invested his retirement fund of $50,000 (which was earning 10 percent interest) in this venture. After all expenses, his net winnings were $35,000.
Calculation of the economic profit:Economic profit = Revenue - Opportunity cost
Economic profit = $35,000 - (30,000 + (10% x 50,000))
Economic profit = $35,000 - $35,000
Economic profit = $0
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Suppose a company owns a fancy 3D printer which cost $1500 to buy. The printer depreciates $200 per year. (a) If the interest rate is 3 percent, what is the implicit rental price of the printer per year? (b) Does your answer to part (a) depend on whether the company used its own money to buy the printer, or if it took out a loan? Why? Suppose a newer edition of the 3D printer comes out for $2000. Because better technology is used, there is less depreciation; it only depreciates by $150 a year. (c) Calculate the implicit rental price for the new edition of the printer. Which edition of the printer - old or new - has a larger implicit rental price? (d) Suppose the interest rate was instead 5 percent, rather than 3 percent. Which edition of the printer - old or new - has a larger implicit rental price? Compare your answer with part (c), and comment on any difference.
Answer:
a) Implicit Rental Price:
Normal annual cost = $200
3% of $1,500 = 45
Implicit rental price = $245
b) The answer to part (a) does not depend on whether the company used its own money to buy the printer or if it took out a loan, provided that the cost of the loan remains within the 3% accepted rate. The reason for my answer is that the calculation of the implicit rental price is an economic measurement that tries to capture the opportunity cost of a project and not just the actual cost.
c) Implicit Rental Price:
Normal annual cost = $150
3% of $2,000 = 60
Implicit rental price = $210
The old edition of the printer has a larger implicit rental price.
d) Interest rate = 5%
Old edition: Implicit Rental Price:
Normal annual cost = $200
5% of $1,500 = 75
Implicit rental price = $275
New Edition:
Normal annual cost = $150
5% of $2,000 = 100
Implicit rental price = $250
The old edition of the printer still has a higher implicit rental price of $270 compared to the new edition's $250, with a difference of $20.
Explanation:
Determining the implicit rental price for the 3D printer, one is forced to consider the lost interest that the investment in the printer would occasion. By this, the use of the implicit rental price ensures that the only cost of a project is not the direct costs, but also includes some opportunity costs. Opportunity costs are costs incurred from the revenue lost because another option is chosen.
If there is a decrease in the short-run aggregate supply curve and no changes in fiscal policy are implemented, the economy over time will Group of answer choices Remain at the new price and output level Experience a leftward shift in the aggregate demand curve Return to the original output and price level Experience increasing nominal wages Continue to have rising prices and decreasing Real GDP
Answer: Return to the original output and price level
Explanation:
There is a general consensus in the Economic world that the Economy will usually adjust back to a level of full employment which is the Long Run Aggregate Supply curve.
When the short short-run aggregate supply curve experiences a decrease, the variables at play will adjust to such a point where they will return to the Original Output and price level assuming that was the Long Run AS level. For instance, if the price of a raw material needed in production rises, output will decrease as the inputs have become more expensive. As a result of this decrease in output, unemployment goes up which will theoretically mean that wages will go down as there are now more people looking for jobs. This will reduce the wage cost and producers will take advantage to start producing more bringing the Economy back to the original level.
Q 9.42: A plant asset was purchased on January 1 for $80,000 with an estimated salvage value of $20,000 at the end of its useful life. The current year's Depreciation Expense is $10,000 calculated on the straight-line basis and the balance of the Accumulated Depreciation account at the end of the year is $20,000. The remaining useful life of the plant asset is ________ years.
Answer:
4 years
Explanation:
For calculation of remaining useful life of the plant asset first we need to find out the Straight Line Depreciation (annual), useful life and life end which is shown below:-
Straight Line Depreciation (annual) = (Cost – Salvage Value) ÷ Useful Life
$10,000 = ($80,000 - $20,000) ÷ Useful Life
$10,000 × Useful Life = $80,000 - $20,000
Useful Life = ($80,000 - $20,000) ÷ $10,000
Useful Life = 6 years
Life ended = Accumulated Depreciation ÷ Annual Depreciation
= $20,000 ÷ $10,000
= 2 years
Remaining Useful Life = Useful life - Life ended
= 6 years - 2 years
= 4 years
Health insurance Plan A requires the insured to pay $1000 or 50% of total cost, whichever is lower. Plan B requires the insured to pay the initial $300, but then pays 80% of the cost over $300. Which of the following is a cost level for which both insurance plans pay out the same amount?
A. $600
B. $1000
C. $3800
D. $5300
E. $6200
Answer:
C. $3,800
Explanation:
The computation of the cost level for both insurance policy is shown below:
We choose $1,000 or 50% which ever is lower
We take the help of the given options
a. For the first option
The 50% is 300 which is less than the 1,000 now we take 80% of ($600 - $300) that comes $240
b. For the second option
The 50% is 500 which is less than 500 now we take 80% of ($1,000 - $300) that comes $560
c. For the third optiion
The 50% of $3,800 i.e $1,900 and $1,000 whichever is less i.e ($3,800 - $1,000) = $2,800 so it is $1,000 now we take the 80% of ($3,800 - $300) i.e $2,800
Thus the amount comes same
Thus this is the right option
59. A poultry rancher discovered that when she increased the price of organic eggs from $0.75 to $1.00 per dozen, the sales of her eggs fell from 300 dozen per week to 200 dozen per week. Her price elasticity of demand (using the midpoint method) would be:
Answer:
PED = -1.4 or |1.4| in absolute values, price elastic
Explanation:
the price elasticity of demand (PED) using the midpoint method:
PED = % change in quantity / % change in price
% change in quantity = {(Q 2 − Q1 ) / [(Q2 + Q1)/2]} x 100 = {(200 − 300 ) / [(200 + 300)/2]} x 100 = -100 / 250 = -0.4% change in price = {(P2 − P1 ) / [(P2 + P1)/2]} x 100 = {(1 − 0.75 ) / [(1 + 0.75)/2]} x 100 = 0.286PED = -0.4 / 0.286 = -1.4 or |1.4| in absolute values
Leslie goes to a store to buy a dishwasher advertised at a great sale price only to find it is "sold out" (because only a few were available to begin with), and she ends up buying a more expensive dishwasher. This "bait and switch" system is an example of the _____ technique.
Answer: Low - ball
Explanation: The low- ball technique could be explained as a trick used by sellers to lure consumers into making a purchase by offering an exciting and low priced product for sale. This offer gets the buyer or consumer committed to such product. However, these offer isn't one in which the seller really intends to uphold as it is just to get the buyers to commit, then the price is suddenly upped or increased at which point the committed buyer ends up paying the increased fee for such product. In the scenario above, only few low priced products were made
available as the seller does not intend to uphold the low price advertised with the buyer eventually purchasing at an increased price.