Question 3
03. Prevailing competitive prices (PCP's) are:
OA. The prices charged by all repair facilities in a market area.
OB The average prices charged by all repair facilities in a market area.
OC. The prices charged by not less than a majority of the repair market.
D. None of the above.
OB. The average prices charged by all repair facilities in a market area.
To determine the answer to this question, we need to understand what prevailing competitive prices (PCP's) refer to.
Prevailing competitive prices (PCP's) are the prices that are commonly charged by repair facilities in a particular market area. These prices help provide a benchmark or reference point for customers to compare prices and ensure that they are getting a fair deal.
Now, let's evaluate each option based on this explanation:
OA. The prices charged by all repair facilities in a market area.
This option suggests that PCP's are the prices charged by every single repair facility in a market area. However, it is unlikely that all repair facilities in a market area would charge identical prices. Therefore, this option doesn't accurately reflect PCP's.
OB. The average prices charged by all repair facilities in a market area.
This option suggests that PCP's are the average prices charged by all repair facilities in a market area. This is a more reasonable interpretation, as taking the average of prices charged by various repair facilities could result in a representative benchmark for PCP's.
OC. The prices charged by not less than a majority of the repair market.
This option suggests that PCP's are the prices charged by a majority (more than half) of the repair market. While this may capture a significant portion of the repair market, it doesn't necessarily represent the prevailing prices charged by repair facilities in a market area as a whole.
D. None of the above.
This option implies that none of the provided options accurately describe prevailing competitive prices (PCP's).
Based on the explanation above, the most appropriate answer to the question is:
OB. The average prices charged by all repair facilities in a market area.
The correct answer is:
OB. The average prices charged by all repair facilities in a market area.