Question 1

Companies using target costing ________.

Accepted Answer

A)  first design a new product and then determine its cost 
B)  tailor their products to be in line with the marketing mix 
C)  routinely neglect customer value considerations 
D)  avoid determining an ideal selling price until analyzing test market results 
E)  start with an ideal selling price and then target costs that will ensure that the price is met 
A)  first design a new product and then determine its cost 
B)  tailor their products to be in line with the marketing mix 
C)  routinely neglect customer value considerations 
D)  avoid determining an ideal selling price until analyzing test market results 
E)  start with an ideal selling price and then target costs that will ensure that the price is met

Question 2

A break-even chart shows the total cost and total revenue expected at various sales volume levels.

Accepted Answer

A) True 
 B)False

Question 3

What is high-low pricing?

Accepted Answer

High-low pricing involves char

Question 4

In which situation is the market dominated by one seller?

Accepted Answer

A)  pure monopoly 
B)  monopolistic competition 
C)  oligopolistic competition 
D)  pure competition 
E)  free market 
A)  pure monopoly 
B)  monopolistic competition 
C)  oligopolistic competition 
D)  pure competition 
E)  free market

Question 5

Which of the following is most likely a fixed cost?

Accepted Answer

A)  sales representative commissions 
B)  product distribution costs 
C)  manufacturing input costs 
D)  temporary worker salaries 
E)  facility rental payments 
A)  sales representative commissions 
B)  product distribution costs 
C)  manufacturing input costs 
D)  temporary worker salaries 
E)  facility rental payments

Question 6

Which of the following is true with regard to value-added pricing?

Accepted Answer

A)  Companies that practice value-added pricing typically match the competition by cutting prices. 
B)  Companies practicing value-added pricing differentiate their offers by attaching value-added features to offerings that, in turn, justify higher prices. 
C)  The intrinsic value of products sold by companies practicing value-added pricing is far less than their actual selling price. 
D)  Companies practicing value-added pricing primarily rely on cost differentiation. 
E)  Value-added pricing is the most suitable pricing strategy in pure monopolies. 
A)  Companies that practice value-added pricing typically match the competition by cutting prices. 
B)  Companies practicing value-added pricing differentiate their offers by attaching value-added features to offerings that, in turn, justify higher prices. 
C)  The intrinsic value of products sold by companies practicing value-added pricing is far less than their actual selling price. 
D)  Companies practicing value-added pricing primarily rely on cost differentiation. 
E)  Value-added pricing is the most suitable pricing strategy in pure monopolies.

Question 7

What sets the floor for product prices?

Accepted Answer

A)  consumer perceptions of the product's value 
B)  product costs 
C)  competitors' strategies 
D)  advertising budgets 
E)  market competition 
A)  consumer perceptions of the product's value 
B)  product costs 
C)  competitors' strategies 
D)  advertising budgets 
E)  market competition

Question 8

PoolPak produces climate-control systems for large swimming pools. The company's customers are more concerned about service support for maintaining their systems than the initial price of the product. PoolPak specializes in and differentiates itself through both cutting-edge technologies used to build its high-value climate control systems as well as seamless quality service. PoolPak's prices are very high, but demand for its climate-control systems seems to be forever on the rise. This exemplifies ________.

Accepted Answer

A)  target costing 
B)  a pure monopoly 
C)  cost-plus pricing 
D)  a nonprice position 
E)  break-even pricing 
A)  target costing 
B)  a pure monopoly 
C)  cost-plus pricing 
D)  a nonprice position 
E)  break-even pricing

Question 9

When companies set prices, the government and social concerns are ________ factors affecting pricing decisions.

Accepted Answer

A)  external 
B)  internal 
C)  economic 
D)  cultural 
E)  organizational 
A)  external 
B)  internal 
C)  economic 
D)  cultural 
E)  organizational

Question 10

A marketer's fixed costs are $400,000. The variable cost is $16 per unit, and the price of the product is $24 per unit. If the company wants to make a profit, how many units must it sell and at what price?

Accepted Answer

If the company wants

Question 11

A company faces fixed costs of $100,000 and variable costs of $8 per unit. It plans to directly sell its product in the market for $12. How many units must it produce and sell to break even?

Accepted Answer

A)  20,000 
B)  25,000 
C)  30,000 
D)  35,000 
E)  40,000 
A)  20,000 
B)  25,000 
C)  30,000 
D)  35,000 
E)  40,000

Question 12

Briefly discuss monopolistic competition.

Accepted Answer

Under monopolistic competition, the mark

Question 13

The long-run average cost (LRAC) curve indicates the ________.

Accepted Answer

A)  per unit cost of output in the long run 
B)  projected total production costs of competitors 
C)  variable costs incurred by a firm over time 
D)  fixed costs incurred by a firm over the long term 
E)  number of units the market will buy in a given time period, at different prices that might be charged 
A)  per unit cost of output in the long run 
B)  projected total production costs of competitors 
C)  variable costs incurred by a firm over time 
D)  fixed costs incurred by a firm over the long term 
E)  number of units the market will buy in a given time period, at different prices that might be charged

Question 14

Markup pricing is popular because when all firms in the industry use this pricing method, prices tend to be similar, so price competition is minimized.

Accepted Answer

A) True 
 B)False

Question 15

Under ________, the market consists of many buyers and sellers trading in a uniform commodity.

Accepted Answer

A)  pure competition 
B)  monopolistic competition 
C)  oligopolistic competition 
D)  a pure monopoly 
E)  the dominant firm model 
A)  pure competition 
B)  monopolistic competition 
C)  oligopolistic competition 
D)  a pure monopoly 
E)  the dominant firm model

Question 16

Companies with lower costs ________.

Accepted Answer

A)  specialize in selling products with value-added features 
B)  usually market products with inferior quality, thereby justifying the low selling price 
C)  can set lower prices that result in smaller margins but greater sales and profits 
D)  tend to overprice products owing to their monopolistic advantage 
E)  usually set higher prices that result in higher margins 
A)  specialize in selling products with value-added features 
B)  usually market products with inferior quality, thereby justifying the low selling price 
C)  can set lower prices that result in smaller margins but greater sales and profits 
D)  tend to overprice products owing to their monopolistic advantage 
E)  usually set higher prices that result in higher margins

Question 17

In Viña del Mar, Chile, a large number of shops specialize in selling the same quality of seafood products along the beach frequented by tourists. No individual shop dares charge more than the going price without fearing loss of business to other shops. This exemplifies ________.

Accepted Answer

A)  pure competition 
B)  monopolistic competition 
C)  oligopolistic competition 
D)  pure monopoly 
E)  the dominant firm model 
A)  pure competition 
B)  monopolistic competition 
C)  oligopolistic competition 
D)  pure monopoly 
E)  the dominant firm model

Question 18

Which of the following is an internal factor that affects pricing decisions in a company?

Accepted Answer

A)  the nature of the market 
B)  the degree of inflation in the economy 
C)  the overall marketing strategy of the company 
D)  the forces of demand and supply in the market 
E)  consumers' perception of value 
A)  the nature of the market 
B)  the degree of inflation in the economy 
C)  the overall marketing strategy of the company 
D)  the forces of demand and supply in the market 
E)  consumers' perception of value

Question 19

Companies that adopt value-added pricing ________.

Accepted Answer

A)  consider value-added features as a fitting substitute for aggressive cost cutting 
B)  set incredibly low prices to meet competition 
C)  attach value-added features and services to differentiate their offers and support their higher prices 
D)  overprice their products without any apparent justification 
E)  underprice their products and lower quality to boost demand in the short-run 
A)  consider value-added features as a fitting substitute for aggressive cost cutting 
B)  set incredibly low prices to meet competition 
C)  attach value-added features and services to differentiate their offers and support their higher prices 
D)  overprice their products without any apparent justification 
E)  underprice their products and lower quality to boost demand in the short-run

Question 20

The experience curve reveals that ________.

Accepted Answer

A)  repetition in production has no visible impact on production costs 
B)  repetition in production enhances efficiency 
C)  the average cost of production remains the same with accumulated production experience 
D)  repetition in production adds to the costs and thereby increases the prices of outputs 
E)  the average cost of production increases with accumulated production experience 
A)  repetition in production has no visible impact on production costs 
B)  repetition in production enhances efficiency 
C)  the average cost of production remains the same with accumulated production experience 
D)  repetition in production adds to the costs and thereby increases the prices of outputs 
E)  the average cost of production increases with accumulated production experience

Companies using target costing ________.

A break-even chart shows the total cost and total revenue expected at various sales volume levels.

What is high-low pricing?

In which situation is the market dominated by one seller?

Which of the following is most likely a fixed cost?

Which of the following is true with regard to value-added pricing?

What sets the floor for product prices?

When companies set prices, the government and social concerns are ________ factors affecting pricing decisions.

A marketer's fixed costs are $400,000. The variable cost is $16 per unit, and the price of the product is $24 per unit. If the company wants to make a profit, how many units must it sell and at what price?

A company faces fixed costs of $100,000 and variable costs of $8 per unit. It plans to directly sell its product in the market for $12. How many units must it produce and sell to break even?

Briefly discuss monopolistic competition.

The long-run average cost (LRAC) curve indicates the ________.

Markup pricing is popular because when all firms in the industry use this pricing method, prices tend to be similar, so price competition is minimized.

Under ________, the market consists of many buyers and sellers trading in a uniform commodity.

Companies with lower costs ________.

In Viña del Mar, Chile, a large number of shops specialize in selling the same quality of seafood products along the beach frequented by tourists. No individual shop dares charge more than the going price without fearing loss of business to other shops. This exemplifies ________.

Which of the following is an internal factor that affects pricing decisions in a company?

Companies that adopt value-added pricing ________.

The experience curve reveals that ________.

Marketing: Creating Customer Value and Engagement

Company and Marketing Strategy: Partnering to Build Customer Relationships

Analyzing the Marketing Environment

Managing Marketing Information to Gain Customer Insights

Consumer Markets and Buyer Behavior

Business Markets and Business Buyer Behavior

Customer-Driven Marketing Strategy: Creating Value for Target Customers

Products, Services, and Brands: Building Customer Value

New Product Development and Product Life-Cycle Strategies

Pricing Strategies: Additional Considerations

Marketing Channels: Delivering Customer Value

Retailing and Wholesaling

Engaging Customers and Communicating Customer Value: Integrated Marketing Communications Strategy

Advertising and Public Relations

Personal Selling and Sales Promotion

Direct, Online, Social Media, and Mobile Marketing

Creating Competitive Advantage

The Global Marketplace

Sustainable Marketing: Social Responsibility and Ethics

Filters

Exam 10: Pricing: Understanding and Capturing Customer Value

Companies using target costing ________.

A break-even chart shows the total cost and total revenue expected at various sales volume levels.

What is high-low pricing?

In which situation is the market dominated by one seller?

Which of the following is most likely a fixed cost?

Which of the following is true with regard to value-added pricing?

What sets the floor for product prices?

When companies set prices, the government and social concerns are ________ factors affecting pricing decisions.

A marketer's fixed costs are $400,000. The variable cost is $16 per unit, and the price of the product is $24 per unit. If the company wants to make a profit, how many units must it sell and at what price?

A company faces fixed costs of $100,000 and variable costs of $8 per unit. It plans to directly sell its product in the market for $12. How many units must it produce and sell to break even?

Briefly discuss monopolistic competition.

The long-run average cost (LRAC) curve indicates the ________.

Markup pricing is popular because when all firms in the industry use this pricing method, prices tend to be similar, so price competition is minimized.

Under ________, the market consists of many buyers and sellers trading in a uniform commodity.

Companies with lower costs ________.

In Viña del Mar, Chile, a large number of shops specialize in selling the same quality of seafood products along the beach frequented by tourists. No individual shop dares charge more than the going price without fearing loss of business to other shops. This exemplifies ________.

Which of the following is an internal factor that affects pricing decisions in a company?

Companies that adopt value-added pricing ________.

The experience curve reveals that ________.

Marketing: Creating Customer Value and Engagement

Company and Marketing Strategy: Partnering to Build Customer Relationships

Analyzing the Marketing Environment

Managing Marketing Information to Gain Customer Insights

Consumer Markets and Buyer Behavior

Business Markets and Business Buyer Behavior

Customer-Driven Marketing Strategy: Creating Value for Target Customers

Products, Services, and Brands: Building Customer Value

New Product Development and Product Life-Cycle Strategies

Pricing Strategies: Additional Considerations

Marketing Channels: Delivering Customer Value

Retailing and Wholesaling

Engaging Customers and Communicating Customer Value: Integrated Marketing Communications Strategy

Advertising and Public Relations

Personal Selling and Sales Promotion

Direct, Online, Social Media, and Mobile Marketing

Creating Competitive Advantage

The Global Marketplace

Sustainable Marketing: Social Responsibility and Ethics

Filters