Ron's Long Run Roofing is basing its pricing policy on satisfactory profits (B). This approach is about maintaining acceptable profit levels for shareholders and management, rather than maximising profit. It differs from other pricing strategies such as stable sales levels, profit maximisation, market share, and consumer demand.
Ron's Long Run Roofing bases its pricing policy on B. satisfactory profits. The goal of satisfactory profits is to keep profits at a level that is acceptable to both shareholders and management, rather than trying to maximise profit to the possible detriment of other factors such as customer loyalty, employee satisfaction, and long-term sustainability. For example, Ron may set a pricing structure that covers costs and provides a reasonable margin, but doesn't necessarily take into account what the market will bear or maximise potential returns.
This differs from other pricing strategies such as stable sales levels (A), where the focus is on maintaining consistent sales volumes; profit maximisation (C), which aims to achieve the highest possible profit level; market share (D), where the goal is to capture a greater proportion of the market regardless of profit levels; and consumer demand (E), where pricing is set based on what the consumer is willing to pay.
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