BUSINESS ADMINISTRATION
BUSINESS ENVIRONMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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TRUE OR FALSE:A retailer of gold jewelry is not affected by changes in the prices of gold.
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TRUE
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FALSE
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Explanation:
Detailed explanation-1: -Demand and Supply: When there is a rise in demand for gold, the price increases, and vice versa. Gold is one commodity that is continuously in demand. Demand and supply play a major role in pricing of gold.
Detailed explanation-2: -The formula used by the jewelers for gold rate calculation is: Final price of the jewelry = Price of gold per gram (22 carat or 18 carat) X (Weight in grams) + making charges/gram + Goods and Services Tax (GST) on (Price of jewelry + making charges).
Detailed explanation-3: -While the price of a fancy piece might even decrease with time, prices of gold and diamonds tend to increase.
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