Question 1

________ reward dealers for participating in advertising and sales support programs.

Accepted Answer

A) Functional discounts 
B) Trade discounts 
C) Promotional allowances 
D) Rebates 
E) Quantity discounts 
A) Functional discounts 
B) Trade discounts 
C) Promotional allowances 
D) Rebates 
E) Quantity discounts

Question 2

In high-low pricing,retailers charge low prices on an everyday basis with occasional price increases.

Accepted Answer

A) True 
 B)False

Question 3

Costs that differ directly with the level of production are known as ________.

Accepted Answer

A) fixed costs 
B) overhead costs 
C) opportunity costs 
D) target costs 
E) variable costs 
A) fixed costs 
B) overhead costs 
C) opportunity costs 
D) target costs 
E) variable costs

Question 4

Agatha's is about to introduce a new product in the market,but is not sure as to how it should price the product.The company is facing intense competition from 5 other companies.In the past,it has also failed to keep up with the changing consumer wants.In such a situation,what should be its main objective?

Accepted Answer

The main objective for Agatha's should b

Question 5

Today,consumers are price takers and accept prices at face value or as given.

Accepted Answer

A) True 
 B)False

Question 6

________ are granted for turning in old item when buying a new one.

Accepted Answer

A) Promotional allowances 
B) Quantity discounts 
C) Functional discounts 
D) Seasonal discounts 
E) Trade-in allowances 
A) Promotional allowances 
B) Quantity discounts 
C) Functional discounts 
D) Seasonal discounts 
E) Trade-in allowances

Question 7

________ price refers to what the consumers feel the product should cost.

Accepted Answer

A) Fair 
B) Typical 
C) Usual discounted 
D) List 
E) Maximum retail 
A) Fair 
B) Typical 
C) Usual discounted 
D) List 
E) Maximum retail

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

In ________,the seller charges a separate price to each customer depending on the intensity of his or her demand.

Accepted Answer

A) second-degree price discrimination 
B) third-degree price discrimination 
C) psychological discounting 
D) special-customer pricing 
E) first-degree price discrimination 
A) second-degree price discrimination 
B) third-degree price discrimination 
C) psychological discounting 
D) special-customer pricing 
E) first-degree price discrimination

Question 10

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' ________.

Accepted Answer

A) last paid price 
B) expected future price 
C) lower-bound price 
D) upper-bound price 
E) typical price 
A) last paid price 
B) expected future price 
C) lower-bound price 
D) upper-bound price 
E) typical price

Question 11

Cost inflation provokes price increases.

Accepted Answer

A) True 
 B)False

Question 12

In reality,it is very easy for firms to estimate their demand and cost functions.

Accepted Answer

A) True 
 B)False

Question 13

For price discrimination to work,________.

Accepted Answer

A) the market must be segmentable and the segments must show similar intensities of demand 
B) members in the lower-price segment must be able to resell the product to the higher-price segment 
C) competitors must be able to undersell the firm in the higher-price segment 
D) the practice must not breed customer resentment and ill will 
E) the extra revenue derived from price discrimination must not exceed the cost of segmenting and policing the market 
A) the market must be segmentable and the segments must show similar intensities of demand 
B) members in the lower-price segment must be able to resell the product to the higher-price segment 
C) competitors must be able to undersell the firm in the higher-price segment 
D) the practice must not breed customer resentment and ill will 
E) the extra revenue derived from price discrimination must not exceed the cost of segmenting and policing the market

Question 14

Customers usually have a lower price threshold below which prices signal inferior or unacceptable quality,as well as an upper price threshold above which prices are prohibitive and the product appears not worth the money.

Accepted Answer

A) True 
 B)False

Question 15

Costs that do not vary with production levels or sales revenue are known as ________.

Accepted Answer

A) overhead costs 
B) variable costs 
C) average costs 
D) opportunity costs 
E) total costs 
A) overhead costs 
B) variable costs 
C) average costs 
D) opportunity costs 
E) total costs

Question 16

A quantity discount is a price reduction given to those who pay their bills promptly.

Accepted Answer

A) True 
 B)False

Question 17

Deducting the desired profit margin from the price at which a product will sell,given its appeal and competitors' prices,is known as ________.

Accepted Answer

A) overhead costing 
B) target costing 
C) activity based costing 
D) benefit analysis 
E) estimate costing 
A) overhead costing 
B) target costing 
C) activity based costing 
D) benefit analysis 
E) estimate costing

Question 18

A British aircraft manufacturer sold planes to India for 70 percent cash and the rest in coffee.This is an example of what kind of a countertrade?

Accepted Answer

This is an example of a compen

Question 19

In markets that are characterized by products that are highly homogeneous,how should a firm react to a competitor's reduction in price?

Accepted Answer

A) shrink the amount of the product available 
B) substitute expensive materials or ingredients 
C) reduce product features 
D) reduce product services 
E) augment the product 
A) shrink the amount of the product available 
B) substitute expensive materials or ingredients 
C) reduce product features 
D) reduce product services 
E) augment the product

Question 20

When a company introduces a product at a very high price and then gradually drops the price over time,it is pursuing a ________ strategy.

Accepted Answer

A) market-penetration pricing 
B) market-skimming pricing 
C) value-pricing 
D) switching cost 
E) loss-leader pricing 
A) market-penetration pricing 
B) market-skimming pricing 
C) value-pricing 
D) switching cost 
E) loss-leader pricing

Exam 14: Developing Pricing Strategies and Programs

________ reward dealers for participating in advertising and sales support programs.

In high-low pricing,retailers charge low prices on an everyday basis with occasional price increases.

Costs that differ directly with the level of production are known as ________.

Today,consumers are price takers and accept prices at face value or as given.

________ are granted for turning in old item when buying a new one.

________ price refers to what the consumers feel the product should cost.

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

In ________,the seller charges a separate price to each customer depending on the intensity of his or her demand.

Cost inflation provokes price increases.

In reality,it is very easy for firms to estimate their demand and cost functions.

For price discrimination to work,________.

Customers usually have a lower price threshold below which prices signal inferior or unacceptable quality,as well as an upper price threshold above which prices are prohibitive and the product appears not worth the money.

Costs that do not vary with production levels or sales revenue are known as ________.

A quantity discount is a price reduction given to those who pay their bills promptly.

Deducting the desired profit margin from the price at which a product will sell,given its appeal and competitors' prices,is known as ________.

A British aircraft manufacturer sold planes to India for 70 percent cash and the rest in coffee.This is an example of what kind of a countertrade?

In markets that are characterized by products that are highly homogeneous,how should a firm react to a competitor's reduction in price?

When a company introduces a product at a very high price and then gradually drops the price over time,it is pursuing a ________ strategy.

Defining Marketing for the New Realities

Developing Marketing Strategies and Plans

Gathering Information and Forecasting Demand

Conducting Marketing Research

Creating Customer Value,satisfaction,and Loyalty

Analyzing Consumer Markets

Analyzing Business Markets

Identifying Market Segments and Targets

Creating Brand Equity

Crafting the Brand Positioning

Competitive Dynamics

Setting Product Strategy

Designing and Managing Services

Designing and Managing Marketing Channels and Value Networks

Managing Retailing,wholesaling,and Logistics

Designing and Managing Integrated Marketing Communications

Managing Mass Communications: Advertising, sales Promotions, events, and Public Relations

Managing Digital Communications: Online, social Media, and Mobile

Managing Personal Communications: Direct and Database Marketing and Personal Selling

Introducing New Market Offerings

Tapping Into Global Markets

Managing a Holistic Marketing Organization

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