Afew months before, a major b2b supplier raised prices of its products 10 percent to cover changes in market conditions. he was surprised to find how the orders from his normal customers plummeted. his normal order was $1,100. after the price increase, the average order dropped by 25 percent. he became concerned that customers might look elsewhere. for this reason, he decided to start offering discounts. when one of his loyal customers, david, purchases $950 worth of product for his firm, the supplier gives david the terms "4/20 net 30." he wants to maintain his relationship with david and would ideally like to receive payment in less than a month. refer to scenario 19.3. consider how the average order amount changed when prices were raised $75. the elasticity of demand is with this in mind, the product can best be described as

Lipman auto parts, a family-owned auto parts store, began january with $10,300.00 in cash. management forecasts that collections from credit customers will be $11,400.00 in january and $14,800.00 in february. the store is scheduled to receive $5,000.00 in cash on a business note receivable in january. projected cash payments include inventory purchases ($13,000.00 in january and $13,600.00 in february) and operating expenses ($2,700.00 each month). lipman auto parts' bank requires a $10,000.00 minimum balance in the store's checking account. at the end of any month when the account balance dips below $10,000.00, the bank automatically extends credit to the store in multiples of $1,000.00. lipman auto parts borrows as little as possible and pays back loans in quarterly installments of $2,000.00, plus 4 percent interest on the entire unpaid principal. the first payment occurs three months after the loan.