Exam 11: Pricing Strategies: Additional Considerations

In a bid to attract more customers in a market that has several competitors, Barrymore's Bakery slashed the prices of all its products by 50 percent. Managers at the firm reasoned that lower prices would draw in even more customers, making up for the reduction in price several times over. Which of the following pricing strategies are they using?

By definition, ________ pricing is used when a firm sells a product or service at two or more prices, even though the difference in price is not based on differences in cost.

When sellers set prices after talking to competitors and engaging in collusion, they are involved in ________.

Refer to the scenario below to answer the following question(s). Champion, Inc. is a manufacturer of lunch boxes, school bags, and school stationery. Charles Payton, the CEO of Champion, hopes to sell the products at a low price to penetrate the market quickly. -Which of the following best supports a market-penetration strategy for Champion?

Constantly reduced prices can erode a brand's value in the eyes of customers.

What is deceptive pricing?

Excess capacity leads to companies initiating an increase in price.

A quantity discount is a price reduction for buyers who ________.

Midnight Magic, a perfume manufacturing company, plans to release a new fragrance during the holiday season at $99 per bottle. The company intends to bring the price down to $49 within six months of its release to attract buyers who couldn't afford the initial price. Which of the following pricing strategies is Midnight Magic using?

Why do businesses use cash discounts when they are in essence losing some money on the sale?

For what types of products might marketers use market-skimming pricing?

A(n) ________ refers to promotional money paid by manufacturers to retailers in return for an agreement to feature the manufacturer's products in some way.

Which of the following is true of product bundle pricing?

The Sherman, Clayton, and Robinson-Patman Acts are all federal laws that were enacted to curb the formation of ________.

Federal legislation on price fixing requires that sellers set their prices ________.

Give two examples of by-product pricing.

A seasonal discount is a price reduction to buyers who buy merchandise while the products are in season.

________ allowances are price reductions given for turning in an old item when buying a new one.

Customers located close to a firm are less likely to benefit from FOB-origin pricing than customers located further away.

Explain the psychology behind a price of $9.99 instead of $10.00.