This exam may be taken only once. No notes, no books, and no assistance is allowed on this exam. Once you open the exam, you must complete it$.$ You can NOT save it and return to it later. You will have $75$ minutes $(1$ hour and $15$ minutes$)$ to complete $50$ multiple$-$choice questions.

Question $22$

$2$ pts

Theatergoers in the Midwest were pleasantly surprised when they arrived at the cinema to see the latest release and learned that a price reduction had just gone into effect. The Wehrenberg Theater chain, which is the oldest theater company and operates in $15$ Midwest locations, decided to drop matinee prices from $$7\mathrm{.}75$ to $$4\mathrm{.}50$ per person and reduce evening prices from $$9\mathrm{.}75$ to $$7\mathrm{.}50$ per person. The price decrease is a result of decreased traffic at the theater and the trend of consumers waiting to stream movies at home. The Starplex Cinemas operating in the same communities as Wehrenberg followed suit and reduced their prices to attract consumers as well. The two movie theater chains are utilizing the $$ pricing basis.

competition$-$based

markup

cost$-$based

cost$-$plus

marke$-$based

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