Exam 10: Pricing: Understanding and Capturing Customer Value

Give two examples of products for which marketers may use optional-product pricing.

Consumers usually perceive higher-priced products as ________. not within reach of most people having a higher quality having high profit margins popular brands being in the introductory stage of the product life cycle

Give two examples of by-product pricing.

The relationship between the price charged and the resulting demand level can be shown as the ________. demand curve variable cost target cost break-even chart experience curve

Melt-In-Your-Mouth Candy Stores prices its candy displays at ten different price levels, ranging from $2.00 per pound to $4.95 per pound.This is an illustration of price steps.

Why is it difficult to enforce laws against predatory pricing?

A manufacturer offers 3/10, net 30, terms to a wholesaler for a recent purchase.Under these terms, the wholesaler may deduct ________ percent if the bill is paid within ________ days. 10; 30 10; 3 3; 30 3; 10 7; 10

Underpriced products sell very well, but they produce less revenue than they would have if price were raised to the ________ level. perceived value value-based variable demand curve price-floor

Price setting is usually determined by ________ in small companies. top management marketing departments sales departments divisional managers cross-functional teams

Costs that vary directly with the level of production are referred to as ________ costs. fixed variable target total unit

The demand curve shows the number of units the market will buy in a given time period at different prices that might be charged.In normal cases, the higher the price, the higher the demand.

Explain oligopolistic competition.

Compare oligopolistic competition with pure monopoly conditions.

The New Age Gallery has different admission prices for students, adults, and seniors.All three groups are entitled to the same services.This form of pricing is called ________. time-based pricing location pricing customer-segment pricing revenue management pricing generational pricing

If demand hardly changes with a small change in price, we say the demand is ________. variable inelastic value-based at break-even pricing market penetrating

Price escalation in international markets is most likely to result from the higher costs of selling in another country and differences in market conditions or ________. cultural preferences selling strategies regional tastes customer perceptions language barriers

The simplest pricing method is break-even pricing, which involves adding a standard markup to the cost of the product.

Savings for You, a discount retail chain, is highly competitive.When entering a new market, Savings for You often cuts prices so deeply that it sells below costs, effectively pushing smaller companies with less purchasing power out of the market.Savings for You is most at risk of being accused of ________. market skimming price-fixing predatory pricing deceptive pricing price confusion

Johnson Boats wants to introduce a new model of boat into mature markets in highly developed countries with the goal of quickly gaining mass-market share.As a consultant, you should recommend a ________ pricing strategy. market-skimming market-penetration zone discount captive-product

Consumer perceptions of the product's value set the ________ for prices. demand curve floor ceiling variable cost image