1. Briefly explain the three major influences on pricing decisions. 2. There are two approaches to determining pricing decisions for the firm long term. What are the two approaches, how do they differ from one another, and who might use each one? 3. Company X is a four year-old advertising agency that has grown rapidly in the last two years. The company specializes in marketing for professional and semi-professional sports teams, but in the last two years they have branched out to additional markets, such as fitness clothing, energy foods, and sports equipment. 4. Company X has been successful enough that they now have the option of buying out a competing advertising agency, Company Y. That company is a long-time leader in marketing in areas similar to Company X. However, they also have many clients in new markets. 5. What are the opportunity costs if Company X executives decided to acquire Company Y? What are the opportunity costs if Company X executives decide not to acquire Company Y? Why do you think considering opportunity costs is such an important part of business decision making?
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