Question 1

Explain how break- even analysis can be used for target return pricing.

Accepted Answer

The firm determines the price at which it will break even.The firm can also add the target profit to the fixed costs and then determine the new,"break- even point," which now includes the target return.Pricing decisions can be made by examining where the total revenue and total cost curves intersect on a break- even chart at different price points and sales volume.

Question 2

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

Accepted Answer

A) True 
 B)False  True

Question 3

Which of the following statements about break- even analysis is true?

Accepted Answer

A) It is used to determine how much production experience a company must have to achieve desired efficiencies. 
B) It is a technique used to calculate fixed costs. 
C) It is a technique marketers use to examine the relationship between supply and demand. 
D) It determines the amount of retained earnings a company will have during an accounting period. 
E) It is calculated using variable costs,the unit price,and fixed costs. 
A) It is used to determine how much production experience a company must have to achieve desired efficiencies. 
B) It is a technique used to calculate fixed costs. 
C) It is a technique marketers use to examine the relationship between supply and demand. 
D) It determines the amount of retained earnings a company will have during an accounting period. 
E) It is calculated using variable costs,the unit price,and fixed costs. E

Question 4

The break- even volume is the point at which .

Accepted Answer

A) a firm's profit goal is reached 
B) the production of one more unit will not increase profit 
C) the total revenue and total costs lines intersect 
D) demand equals supply 
E) the company can pay all of its long- term debt 
A) a firm's profit goal is reached 
B) the production of one more unit will not increase profit 
C) the total revenue and total costs lines intersect 
D) demand equals supply 
E) the company can pay all of its long- term debt

Question 5

If a seller charges _ than the buyer's perceived value,the company's sales will .

Accepted Answer

A) more;suffer 
B) less;increase 
C) less;suffer 
D) more;benefit 
E) none of the above 
A) more;suffer 
B) less;increase 
C) less;suffer 
D) more;benefit 
E) none of the above

Question 6

pricing works only if that price actually brings in the expected level of sales.

Accepted Answer

A) Inelasticity 
B) Elasticity 
C) Target return 
D) Markup 
E) Variable 
A) Inelasticity 
B) Elasticity 
C) Target return 
D) Markup 
E) Variable

Question 7

In order to form a consistent and effective integrated marketing program,price decisions should be coordinated with each of the following EXCEPT .

Accepted Answer

A) marketing objectives 
B) competitors' prices 
C) promotion decisions 
D) distribution 
E) product design 
A) marketing objectives 
B) competitors' prices 
C) promotion decisions 
D) distribution 
E) product design

Question 8

Compare pure competition with oligopolistic competition.

Accepted Answer

Under pure competition,the market consis

Question 9

A marketer's fixed costs are $400,000,the variable cost is $16,and the company expects the product to sell for $24.What is the company's break- even point in dollar sales?

Accepted Answer

The break- even poin

Question 10

EDLP is very similar to high- low pricing.

Accepted Answer

A) True 
 B)False

Question 11

Who typically sets prices in small companies? In large companies?

Accepted Answer

Top management sets prices in

Question 12

A manufacturer is trying to determine its break- even volume.With fixed costs of $100,000,a variable cost of $10,and expected sales of 50,000 units,what should the manufacturer's unit cost be to break even?

Accepted Answer

A) $16 
B) $12 
C) $10 
D) $20 
E) none of the above 
A) $16 
B) $12 
C) $10 
D) $20 
E) none of the above

Question 13

One reason _ remains popular is that sellers are more certain about costs than about demand.

Accepted Answer

A) inelasticity pricing 
B) penetration pricing 
C) markup pricing 
D) skimming pricing 
E) elasticity pricing 
A) inelasticity pricing 
B) penetration pricing 
C) markup pricing 
D) skimming pricing 
E) elasticity pricing

Question 14

Environmental elements are categorized as external factors that affect pricing decisions.

Accepted Answer

A) True 
 B)False

Question 15

Explain a pure monopoly.

Accepted Answer

The market consists

Question 16

Discuss the importance of consumer perceptions of value and costs to setting prices.

Accepted Answer

Customer perceptions of value set the up

Question 17

What does price elasticity reveal about a product?

Accepted Answer

Price elasticity is a measure of the sen

Question 18

When setting prices,the company must consider its external environment.Describe four parts of the external environment and how they affect businesses.

Accepted Answer

Economic conditions affect both the cost

Question 19

The company designs what it considers to be a good product,totals the expenses of making the product,and sets a price that adds a standard markup to the cost of the product.This approach to pricing is called .

Accepted Answer

A) variable pricing 
B) value- based pricing 
C) cost- plus pricing 
D) skimming pricing 
E) fixed cost pricing 
A) variable pricing 
B) value- based pricing 
C) cost- plus pricing 
D) skimming pricing 
E) fixed cost pricing

Question 20

P&G surveyed the market and identified an unserved segment of the electric toothbrush market.Using these results,P&G created Spinbrush.The unorthodox order of this marketing mix decision is an example of .

Accepted Answer

A) competition- based pricing 
B) penetration pricing 
C) target costing 
D) value- based pricing 
E) cost- plus pricing 
A) competition- based pricing 
B) penetration pricing 
C) target costing 
D) value- based pricing 
E) cost- plus pricing

Explain how break- even analysis can be used for target return pricing.

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

Which of the following statements about break- even analysis is true?

The break- even volume is the point at which .

If a seller charges _ than the buyer's perceived value,the company's sales will .

pricing works only if that price actually brings in the expected level of sales.

In order to form a consistent and effective integrated marketing program,price decisions should be coordinated with each of the following EXCEPT .

Compare pure competition with oligopolistic competition.

A marketer's fixed costs are $400,000,the variable cost is $16,and the company expects the product to sell for $24.What is the company's break- even point in dollar sales?

EDLP is very similar to high- low pricing.

Who typically sets prices in small companies? In large companies?

A manufacturer is trying to determine its break- even volume.With fixed costs of $100,000,a variable cost of $10,and expected sales of 50,000 units,what should the manufacturer's unit cost be to break even?

One reason _ remains popular is that sellers are more certain about costs than about demand.

Environmental elements are categorized as external factors that affect pricing decisions.

Explain a pure monopoly.

Discuss the importance of consumer perceptions of value and costs to setting prices.

What does price elasticity reveal about a product?

When setting prices,the company must consider its external environment.Describe four parts of the external environment and how they affect businesses.

The company designs what it considers to be a good product,totals the expenses of making the product,and sets a price that adds a standard markup to the cost of the product.This approach to pricing is called .

P&G surveyed the market and identified an unserved segment of the electric toothbrush market.Using these results,P&G created Spinbrush.The unorthodox order of this marketing mix decision is an example of .

Marketing: Creating and Capturing Customer Value

Company and Marketing Strategy: Partnering to Build Customer Relationships

Analyzing the Marketing Environment

Managing Marketing Information to Gain Customer Insights

Consumer Markets and Consumer Buyer Behavior

Business Markets and Business Buyer Behavior

Customer-Driven Marketing Strategy: Creating Value for Target Customers

Products, Services, and Brands: Building Customer Value

Developing New Products and Managing the Product Life Cycle

Additional Pricing Considerations

Marketing Channels: Delivering Customer Value

Retailing and Wholesaling

Communicating Customer Value

Advertising and Public Relations

Personal Selling and Sales Promotion

Direct and Online Marketing: Building Direct Customer Relationships

Creating Competitive Advantage

The Global Marketplace

Sustainable Marketing: Social Responsibility and Ethics

Filters

Exam 10: Pricing Strategies: Understanding and Capturing Customer Value

Explain how break- even analysis can be used for target return pricing.

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

Which of the following statements about break- even analysis is true?

The break- even volume is the point at which .

If a seller charges _ than the buyer's perceived value,the company's sales will .

pricing works only if that price actually brings in the expected level of sales.

In order to form a consistent and effective integrated marketing program,price decisions should be coordinated with each of the following EXCEPT .

Compare pure competition with oligopolistic competition.

A marketer's fixed costs are $400,000,the variable cost is $16,and the company expects the product to sell for $24.What is the company's break- even point in dollar sales?

EDLP is very similar to high- low pricing.

Who typically sets prices in small companies? In large companies?

A manufacturer is trying to determine its break- even volume.With fixed costs of $100,000,a variable cost of $10,and expected sales of 50,000 units,what should the manufacturer's unit cost be to break even?

One reason _ remains popular is that sellers are more certain about costs than about demand.

Environmental elements are categorized as external factors that affect pricing decisions.

Explain a pure monopoly.

Discuss the importance of consumer perceptions of value and costs to setting prices.

What does price elasticity reveal about a product?

When setting prices,the company must consider its external environment.Describe four parts of the external environment and how they affect businesses.

The company designs what it considers to be a good product,totals the expenses of making the product,and sets a price that adds a standard markup to the cost of the product.This approach to pricing is called .

P&G surveyed the market and identified an unserved segment of the electric toothbrush market.Using these results,P&G created Spinbrush.The unorthodox order of this marketing mix decision is an example of .

Marketing: Creating and Capturing Customer Value

Company and Marketing Strategy: Partnering to Build Customer Relationships

Analyzing the Marketing Environment

Managing Marketing Information to Gain Customer Insights

Consumer Markets and Consumer Buyer Behavior

Business Markets and Business Buyer Behavior

Customer-Driven Marketing Strategy: Creating Value for Target Customers

Products, Services, and Brands: Building Customer Value

Developing New Products and Managing the Product Life Cycle

Additional Pricing Considerations

Marketing Channels: Delivering Customer Value

Retailing and Wholesaling

Communicating Customer Value

Advertising and Public Relations

Personal Selling and Sales Promotion

Direct and Online Marketing: Building Direct Customer Relationships

Creating Competitive Advantage

The Global Marketplace

Sustainable Marketing: Social Responsibility and Ethics

Filters