Module+14000+XI+Vocabulary

=XI. Module 14000 Vocabulary CQ =

**Absorption costing** assigns all manufacturing costs, direct materials, direct labor, variable overhead, and a share of fixed overhead to each unit of product. **Contribution margin variance** is simply the difference between actual and budgeted contribution margin. **Dumping** is predatory pricing on the international market. **Market share** gives the proportion of industry sales accounted for by a company. **Market share variance** is the difference between the actual market share percentage and the budgeted market share percentage multiplied by actual industry sales in units times budgeted average unit contribution margin. **Markup** is a percentage applied to base cost, including desired profit and any costs not included in the base cost. **Monopolistic competition** has characteristics of both monopoly and perfect competition, but it is much closer to the competitive situation. **Monopoly** creates barriers so high that there is only one firm in the market. **Oligopoly** is characterized by a few seller with high barriers. **Penetration pricing** is the pricing of a new product at a low initial price, perhaps even lower than cost, to build market share quickly. **Perfectly competitive market** has many buyers and sellers, no one of which is large enough to influence the market; a homogeneous product; and easy entry into and exit from the industry. **Predatory pricing** is the practice of setting prices below cost for the purpose of injuring competitors and eliminating competition. **Price discrimination** refers to the charging of different prices to different customers for essentially the same product.

**Price elasticity of demand** is measured as the percentage change in quantity divided by the percentage change in price. **Price gouging** is said to occur when firms with market power price products "too high". **Price skimming** means that a higher price is charged when a product or service is first introduced. **Product life cycle** describes the profit history of the product according to four stages: introduction, growth, maturity and decline. **Sales price variance** is the difference between actual price and expected price multiplied by the actual quantity or volume sold. **Target costing** is a method of determining the cost of a product or service based on the price (target price) that customers are willing to pay. **Variable costing** (sometimes called direct costing) assigns only unit-level variable manufacturing costs to the product; these costs include direct materials, direct labor, and variable overhead.