Exam 14: Developing Pricing Strategies and Programs

On sites such as eBay and Amazon.com, the seller puts up an item and bidders raise the offer price until the top price is reached. What kind of auctions are these?

When Alan bought his car, the bank gave him 24 months to repay his car loan. But when Alan made a request to increase the time frame to 36 months, the bank granted the extension. The bank was willing to offer Alan a ________.

Despite its weaknesses, markup pricing remains popular for which of the following reasons?

Dutch auctions (descending bids) feature many sellers and many buyers, or one buyer and many sellers.

Consumers are less price-sensitive when ________.

Many consumers use price as an indicator of quality and value.

When Coca-Cola carries a different price depending on whether the consumer purchases it in a fine restaurant, a fast-food restaurant, or a vending machine, then this form of price discrimination is known as ________.

Ellie's manager has asked her to come up with ways to reduce costs of their new product by utilizing a process called "target costing." What should Ellie do?

A retailer who holds on to a(n) ________ policy charges a constant low price with little or no price promotions and special sales.

If demand changes considerably, with a small change in price, the demand is said to be ________.

A company has developed the prototype of a mobile phone which it plans to launch in the next few months. The phone comes equipped with the most advanced technological features. As part of its test marketing efforts, it allows customers to examine and use the prototype and also gathers feedback regarding product features and price. The results of this test marketing effort show that customers are willing to pay at least $500, considering the phone's various features. As such, the company has found out about the customers' ________.

A market-penetration pricing strategy is most suitable when _______.

Movie matinees are priced lower than the evening shows; television advertising costs less when run after midnight. These are examples of what type of price discrimination?

________ consist of the sum of the fixed and variable costs for any given level of production.

When examining products, consumers compare an observed price to an internal reference price they remember or an external frame of reference.

A toaster manufacturer who has invested $1 million in the business wants to set a price to earn a 20 percent return on investment, specifically $200,000. What pricing method should it choose?

In which of the following forms of countertrade do buyers and sellers directly exchange goods, with no money and no third party is involved?

If consumers were largely indifferent to a $0.50 increase in the price of a liter of milk, the price rise is said to fall within customers' ________.

Pepsi Co. sold its cola syrup to Japan and agreed to buy Japanese Sake at a certain rate for sale in the United States for the next 5 years. What kind of a countertrade did both the parties indulge in?

In a compensation deal, the seller sells a plant, equipment, or technology to another country and agrees to accept as partial payment products manufactured with the supplied equipment.