Listen to Dialogue No 1 between two speakers and answer the questions below. Then listen again and check your answers.
1. What is the main topic of the conversation?
2. Why did the company fix such a high factory gate price?
3. What is the relation between retail margin and factory gate price?
4. How many items does the distributor intend to purchase?
5. What discount was offered by the producer?
8* Complete the dialogue using the words from the box. There are two expressions which you don't need to use.
JAMES: Do you know that the Japanese computer games company SAWA is planning to launch a new game called Eagle?
RICHARD: That's interesting and what will be the _____(1)______?
JAMES: You know strange as it may seem the development of the game has taken two years but the company expects the product to______(2)_____within one year.
RICHARD: Is that feasible?
JAMES: Well, first the_____(3)_____are low as the labour input in this sector is relatively small, second SAWA intends to conduct a competitive pricing policy with _____(4)______ . That means that the_____(5)_____is expected to be round $55, with the_____(6)______being around 33% of that.
RICHARD: I see, such a low price may have the effect of creating a______(7)______in the computer games market.
JAMES: As far as I can judge aggressive pricing is a new policy for SAWA, as the company aims to increase its _____(8)_____ in the lower end of the games market.
RICHARD: Well, keep me informed of the news about Eagle.
9* Before you listen to Dialogue No 2 use Glossary to choose the best definition for each of the expressions below.
1. cost of production
a. selling price for a finished product
b. all expenses for raw materials, heating, lighting, electricity, etc.
c. all costs involved in making a product ready for distribution and sale
2. cost of sales
a. total costs involved in making a product or service, distributing it and selling it
b. cost of selling a product in salaries, commissions, etc.
c. the price of a product when it is sold
3. selling costs
a. the total money raised selling a product or service
b. the costs involved in distributing, promoting and selling a product
c. the salaries and other expenses paid to the sales representatives
4. fixed costs
a. prices established by the government
b. costs which are decided by the management of a manufacturing company, not by suppliers or retailers
c. costs which do not depend on quantity of production, e.g. heating, lighting, rent
5. variable costs
a. costs which change according to the quantity of production, such as raw materials, components, overtime pay, etc.
b. costs which are difficult to estimate as they may suddenly change because of changes in the market, such as competitors' pricing
c. costs which change according to the time of the year, e.g. warm clothes for winter, or summer fashions
a. regular costs associated with the day-to-day running of a company
b. additional expenses because of a higher than expected demand for products
c. extra costs above what was planned in the costs budget
7. unit cost
a. the costs associated with all production of all products
b. the cost involved in making one single example of a product
c. the total costs for any one part of a factory producing one type of product
8. cost of labour
a. cost of all work involved in making a product or service ready for sale
b. cost of manual workers employed by a company
c. cost of industrial action by employees