Fresnas Designs Inc.is a company known for its quality interior decorations,customized service,and affordable prices.Given the high demand in the market for its service,the management of Fresnas Designs Inc.could price its products higher,but it prefers to price its products such that it will earn a reasonable revenue.In this case,the management of Fresnas Designs Inc.bases its pricing policy on:
A)sales maximization.
B)earning satisfactory profits.
C)creating retained earnings.
D)status quo pricing.

Question

Fresnas Designs Inc.is a company known for its quality interior decorations,customized service,and affordable prices.Given the high demand in the market for its service,the management of Fresnas Designs Inc.could price its products higher,but it prefers to price its products such that it will earn a reasonable revenue.In this case,the management of Fresnas Designs Inc.bases its pricing policy on:
A)​sales maximization.
B)earning satisfactory profits.
C)creating retained earnings.
D)​status quo pricing.

Quizplus · Accepted Answer

The management of Fresnas Designs Inc. prefers to price its products to earn a reasonable revenue, which indicates that they are focused on earning satisfactory profits. This pricing strategy is aligned with the objective of maximizing profits and ensuring sustainable business growth. Therefore, option B is the correct answer. Options A, C, and D are not appropriate as they do not reflect the pricing strategy described in the scenario.