MARK 3000- Final Exam Guide - Comprehensive Notes for the exam ( 72 pages long!)

• School: University of Georgia
• Department: Marketing
• Course: MARK 3000
• Professor: Grantham

Document Summary

Fixed costs (fc): costs that remain unchanged with volume sold: ex: rent for facilities, management salaries, and most advertising media. Variable costs (vc): costs that change with volume sold: ex: material used to construct a product, commissions paid to salespeople, packaging costs, vc are usually assumed to be relatively constant on a per-unit basis. Total costs = total fc + total vc: total variable costs change at a constant rate, total fixed costs don"t (cid:272)ha(cid:374)ge (cid:449)ith u(cid:374)its sold. Note visually how variable costs as well as total costs increase with units sold while fixed costs remain constant. Fixed: rent or office space, sales force salaries, tv advertisement, ceo"s li(cid:373)e lease pa(cid:455)(cid:373)e(cid:374)t. Variable: packaging material, sales force commission, amazon. com shipping charges, mfg warranty expenses. Unit variable cost = total vc for 1 unit of production. Total variable costs = unit vc * units sold. This might occur due to impacts such as volume discounts or economies of scale.