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DASHBOARD COURSE COURSE QUIZZES PRACTICE PV REPORTS An

Quiz: FC_ENG_L6-SET 1
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Question Results
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Q1. Which of the following is a pricing strategy that is used for high-tech and low-availability products and involves selling at a
high price initially and gradually lowering the price of the product to broaden the customer base?
Select the correct answer.
Options:

Market Minimization

Maximization

Market Penetration

Market Skimming

Solution :
Market Skimming is a profit maximization strategy usually used for high-tech and low-availability products. It involves selling at a high price

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initially and gradually lowering the price of the product to broaden the customer base.
SOURCE: VIDEO: Pricing

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Q2. Arnold has started a pizza outlet near an IT park. Most of his customers are regular and well-paid. What type of pricing
strategy should he adopt for pricing his pizzas?
Select the correct answer.
Options:

Market Minimization

Maximization

Market Penetration

Market Skimming

Solution :
Arnold should adopt the Maximization pricing strategy as it determines the price and product output level that generates the maximum profit.
Since his customer base comprises mostly well-paid and regular customers, this strategy will work well for Arnold to maximize his profit.
SOURCE: VIDEO: Pricing

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Q3. For your boutique’s launch, you have bought mannequins, designing tables, sewing machines, and hangers. What type of
costs are these?
Select the correct answer.
Options:

License costs

Fixed costs

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Startup costs

Variable costs

Solution :
All these costs are startup costs.
SOURCE: VIDEO: Cost Structure

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Q4. Which of the following are examples of bootstrapping?

Asking an angel investor to invest in your company

Liquidating your investments to start your company

Asking your father to lend you some money

Approaching a venture capital company for funding

Solution :
Bootstrapping is starting a business using your resources without using external capital. If you want to bootstrap your business, you should
consider options such as liquidating your investments or asking your father to lend you some money.
SOURCE: Bootstrapping: Sources and Uses of Funds

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Q5. Samuel is a freelance photographer. He starts his online stock photo business to sell his photographs. What types of
revenue streams can he target?
Select the two correct answers.
Options:

Advertising fee

Renting fee

Usage fee

Subscription fee

Solution :
Samuel can target two types of revenue streams. First, the renting fee for customers who want to use his images for a time-bound period.
Second, the subscription fee for customers who want to use his images over a prolonged period.
SOURCE: VIDEO: Revenue Streams

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Q6. Aretha has started a fast-food outlet. She estimates spending of $4,900 on Startup costs, $2,050 on Fixed costs per month,
and $25 on Variable costs per unit per month. She estimates a revenue of $6,000 and an additional revenue of $1,000
through home delivery service. Which of the following captures her estimated profit/loss?
Select the correct answer.
Options:

Loss of $950

Profit of $3,950

Profit of $15,000

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Profit of $10,100

Solution :
Aretha’s estimated profit is $3,950 per month. Profit is the revenue that is left with you after the fixed and variable costs have been deducted fro
the total revenue, i.e., revenue from primary as well as secondary revenue streams.
SOURCE: Student Handout: Check the Profitability of Your Business Idea

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Q7. If you are starting a food joint, under which category should you put the monthly salaries of your staff members?
Select the correct answer.
Options:

License costs

Fixed costs

Startup costs

Variable costs

Solution :
You should put the monthly salaries under the category of fixed costs as salaries is a recurring expense, which would mostly remain a fixed
expenditure.
SOURCE: VIDEO: Cost Structure

You scored 2 of 2

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Q8. Which of the following do you need to calculate your gross profit margin?
Select the two correct answers.
Options:

Fixed Costs

Startup Costs

Price per unit

Variable Cost per unit

Solution :
To calculate your gross profit margin, determine the per-unit surplus over and above your variable cost. Numerically, gross profit margin is the
difference between Price per unit and Variable cost per unit.
SOURCE: Student Handout: Check the Profitability of Your Business Idea

You scored 1 of 1

Q9. Kirk buys supplies for his restaurant every alternate day. Due to increased demand around Christmas, he has to buy higher
quantities of supplies every day. What kind of costs are these?
Select the correct answer.
Options:

License costs

Fixed costs

Startup costs

Variable costs

Solution :
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Costs that vary based on consumer usage are called variable costs.

SOURCE: VIDEO: Cost Structure

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Q10. Ray realized that it was not easy to justify the high price of his coffee at his exclusive café and decided to promote his
brand by telling customers that they had a right to demand coffee the way they wanted it and not settle for anything else.
What strategy did Ray adopt here?
Select the correct answer.
Options:

Market Minimization

Maximization

Market Penetration

Market Skimming

Solution :
Ray has adopted the Market Penetration strategy here, as it helped him to penetrate the coffee business in a saturated market. For this, he chos
to attract his customers by pointing out that they had a right to demand coffee the way they wanted it and not settle for anything else.
SOURCE: VIDEO: Pricing

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