Question 1

All of these statements about price are true exceptwhich?

Accepted Answer

A)  Small changes in price can have big effects on both the number of units sold and company profit. 
B)  The price for a product or service must earn a profit for the company. 
C)  For most products and services, there is an agreed-upon price range set by makers. 
D)  The price must be "right"-in the sense that customers must be willing to pay it. 
E)  The price must generate enough sales dollars to pay for the cost of developing, producing, and marketing the product. 
A)  Small changes in price can have big effects on both the number of units sold and company profit. 
B)  The price for a product or service must earn a profit for the company. 
C)  For most products and services, there is an agreed-upon price range set by makers. 
D)  The price must be "right"-in the sense that customers must be willing to pay it. 
E)  The price must generate enough sales dollars to pay for the cost of developing, producing, and marketing the product.

Question 2

Which of these statements regarding the seller's price is most accurate?

Accepted Answer

A)  Internet price changes are regulated by the Internet Fair Practices Act to protect consumers against price gouging. 
B)  The seller's price is constrained by the type of competitive market within which it competes. 
C)  Price changes cannot be regulated in a monopoly. 
D)  The type of market has little or no impact on a firm in a monopolistic competitive environment. 
E)  Competitive environments should affect a firm's pricing objectives, but not its actual product prices. 
A)  Internet price changes are regulated by the Internet Fair Practices Act to protect consumers against price gouging. 
B)  The seller's price is constrained by the type of competitive market within which it competes. 
C)  Price changes cannot be regulated in a monopoly. 
D)  The type of market has little or no impact on a firm in a monopolistic competitive environment. 
E)  Competitive environments should affect a firm's pricing objectives, but not its actual product prices.

Question 3

A firm may forgo a higher profit on sales and follow which of the following pricing objectives because it wants to recognize its stakeholder obligations?

Accepted Answer

A)  profit 
B)  market share 
C)  unit volume 
D)  survival 
E)  social responsibility 
A)  profit 
B)  market share 
C)  unit volume 
D)  survival 
E)  social responsibility

Question 4

Which of these statements regarding sales goals is most accurate?

Accepted Answer

A)  For marketing managers, sales revenue or unit sales objectives can be easily translated into meaningful targets for a product line or brand. 
B)  Cutting prices for a single product in a product line to raise unit sales often results in an increase in sales for related products in the line. 
C)  Very often, cutting prices results in a decrease in market share. 
D)  Setting unit volume sales as a pricing objective results in price wars with competitors, so the practice is limited to industries with few competitors. 
E)  An advantage of increasing unit volume sales is that it always results in an increase in profits. 
A)  For marketing managers, sales revenue or unit sales objectives can be easily translated into meaningful targets for a product line or brand. 
B)  Cutting prices for a single product in a product line to raise unit sales often results in an increase in sales for related products in the line. 
C)  Very often, cutting prices results in a decrease in market share. 
D)  Setting unit volume sales as a pricing objective results in price wars with competitors, so the practice is limited to industries with few competitors. 
E)  An advantage of increasing unit volume sales is that it always results in an increase in profits.

Question 5

Figure 13-6
-The owner of a picture frame store has generated a spreadsheet of several calculations based on different quantity, price, revenue, cost, and profit scenarios shown in Figure 13-6 above. Of the following options, at what sales level is profit maximized?

Accepted Answer

A)  0 
B)  400 
C)  800 
D)  1,200 
E)  2,000 
A)  0 
B)  400 
C)  800 
D)  1,200 
E)  2,000

Question 6

VIZIO is the market leader in the North American ________ market.

Accepted Answer

A)  designer eyewear 
B)  broadcast media 
C)  smart TV 
D)  virtual reality gaming 
E)  luxury travel 
A)  designer eyewear 
B)  broadcast media 
C)  smart TV 
D)  virtual reality gaming 
E)  luxury travel

Question 7

Describe a profit objective used by many Japanese manufacturing firms.

Accepted Answer

Managing for long-run profits is a prici

Question 8

The maximum quantity of products consumers will buy at given price is shown by a

Accepted Answer

A)  demand curve. 
B)  price constraint. 
C)  break-even point. 
D)  supply curve. 
E)  marginal revenue curve. 
A)  demand curve. 
B)  price constraint. 
C)  break-even point. 
D)  supply curve. 
E)  marginal revenue curve.

Question 9

The ratio of the firm's sales revenues or unit sales to those of the industry (competitors plus the firm itself) is referred to as

Accepted Answer

A)  target return on sales. 
B)  industry profit. 
C)  unit volume. 
D)  market share. 
E)  profit. 
A)  target return on sales. 
B)  industry profit. 
C)  unit volume. 
D)  market share. 
E)  profit.

Question 10

According to the profit equation, profit equals

Accepted Answer

A)  Total cost + Total revenue. 
B)  Total revenue − Total cost. 
C)  Marginal revenue − Marginal cost. 
D)  Price × Quantity. 
E)  Total revenue + Marginal cost. 
A)  Total cost + Total revenue. 
B)  Total revenue − Total cost. 
C)  Marginal revenue − Marginal cost. 
D)  Price × Quantity. 
E)  Total revenue + Marginal cost.

Question 11

To increase value, marketers may ________, decrease price, or do both.

Accepted Answer

A)  decrease promotion 
B)  increase benefits 
C)  decrease distribution 
D)  increase advertising 
E)  allow the perceived value of the item to increase as it matures in the life cycle 
A)  decrease promotion 
B)  increase benefits 
C)  decrease distribution 
D)  increase advertising 
E)  allow the perceived value of the item to increase as it matures in the life cycle

Question 12

Forever Quilting makes quilting kits priced at $120. The costs of the materials that go into each kit total $45. It costs $5 in labor to assemble a kit. The company has monthly expenses of $1,000 for rent and insurance, $200 for heat and electricity, $500 for advertising, and $4,500 for the monthly salary of its owner. Forever Quilting's unit variable cost for its kits is

Accepted Answer

A)  $5. 
B)  $45. 
C)  $50. 
D)  $120. 
E)  $170. 
A)  $5. 
B)  $45. 
C)  $50. 
D)  $120. 
E)  $170.

Question 13

Which of these statements about the factors that influence demand is true?

Accepted Answer

A)  As the availability of close substitutes increases, the demand for a product increases. 
B)  As real consumer income increases, the demand for a product increases. 
C)  As the price of close substitutes increases, the demand for a product declines. 
D)  Changing consumer tastes have little impact on the demand for a product. 
E)  As real consumer income decreases, the demand for a product increases. 
A)  As the availability of close substitutes increases, the demand for a product increases. 
B)  As real consumer income increases, the demand for a product increases. 
C)  As the price of close substitutes increases, the demand for a product declines. 
D)  Changing consumer tastes have little impact on the demand for a product. 
E)  As real consumer income decreases, the demand for a product increases.

Question 14

Figure 13-7B
-Suppose you are the owner of a picture frame store. Assume that the average price customers are willing to pay for each picture frame is $120. Also, suppose your fixed costs (FC) total $32,000 (real estate taxes, interest on a bank loan, etc.) and unit variable cost (UVC) for a picture frame is $40 (labor, glass, frame, and matting). According to Figure 13-7 above, how much profit will your picture frame store make if it sells 400 picture frames?

Accepted Answer

A)  $48,000 
B)  $32,000 
C)  $16,000 
D)  $0 
E)  ($32,000) 
A)  $48,000 
B)  $32,000 
C)  $16,000 
D)  $0 
E)  ($32,000)

Question 15

The unit variable cost (UVC) equals variable cost (VC) divided by

Accepted Answer

A)  quantity (Q). 
B)  fixed costs (F
C) . 
C)  total cost (T
C) . 
D)  total revenue (TR). 
E)  price per unit of the product (P). 
A)  quantity (Q). 
B)  fixed costs (F
C) . 
C)  total cost (T
C) . 
D)  total revenue (TR). 
E)  price per unit of the product (P).

Question 16

Figure 13-3
-In Figure 13-3 above, column C represents which type of competitive market?

Accepted Answer

A)  an oligopoly 
B)  monopolistic competition 
C)  a pure monopoly 
D)  pure competition 
E)  oligopolistic competition 
A)  an oligopoly 
B)  monopolistic competition 
C)  a pure monopoly 
D)  pure competition 
E)  oligopolistic competition

Question 17

The owner of a small restaurant that sells takeout fried chicken and biscuits each month pays $2,500 in rent, $500 in utilities, $750 interest on his loan, insurance premium of $200, and $250 on advertising on local buses. A bucket of chicken is priced at $9.50. Unit variable costs for the bucket of chicken are $5.50. How many buckets of chicken does the restaurant need to sell to break even each month?

Accepted Answer

A)  442 buckets 
B)  764 buckets 
C)  1,050 buckets 
D)  3,150 buckets 
E)  4,200 buckets 
A)  442 buckets 
B)  764 buckets 
C)  1,050 buckets 
D)  3,150 buckets 
E)  4,200 buckets

Question 18

Figure 13-3
-In Figure 13-3 above, column A represents which type of competitive market?

Accepted Answer

A)  an oligopoly 
B)  monopolistic competition 
C)  a pure monopoly 
D)  pure competition 
E)  oligopolistic competition 
A)  an oligopoly 
B)  monopolistic competition 
C)  a pure monopoly 
D)  pure competition 
E)  oligopolistic competition

Question 19

The practice of simultaneously increasing product and service benefits while maintaining or decreasing price is referred to as

Accepted Answer

A)  value pricing. 
B)  customer-value pricing. 
C)  competitive pricing. 
D)  cost pricing. 
E)  demand pricing. 
A)  value pricing. 
B)  customer-value pricing. 
C)  competitive pricing. 
D)  cost pricing. 
E)  demand pricing.

Question 20

Managing for long-run profits as a pricing objective implies that a company will

Accepted Answer

A)  give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets. 
B)  maintain a given price range to ensure there is no loss of customers over time, even if the profit margin declines. 
C)  invest excess cash in bonds and certificates of deposit in order to counteract any inflationary economic changes in the future. 
D)  reinvest all profits into market research or product research rather than returned to shareholders. 
E)  drop all products, product lines, or divisions that cannot maintain their pricing goals. 
A)  give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets. 
B)  maintain a given price range to ensure there is no loss of customers over time, even if the profit margin declines. 
C)  invest excess cash in bonds and certificates of deposit in order to counteract any inflationary economic changes in the future. 
D)  reinvest all profits into market research or product research rather than returned to shareholders. 
E)  drop all products, product lines, or divisions that cannot maintain their pricing goals.

Exam 13: Building the Price Foundation

All of these statements about price are true exceptwhich?

Which of these statements regarding the seller's price is most accurate?

A firm may forgo a higher profit on sales and follow which of the following pricing objectives because it wants to recognize its stakeholder obligations?

Which of these statements regarding sales goals is most accurate?

Figure 13-6 -The owner of a picture frame store has generated a spreadsheet of several calculations based on different quantity, price, revenue, cost, and profit scenarios shown in Figure 13-6 above. Of the following options, at what sales level is profit maximized?

VIZIO is the market leader in the North American ________ market.

Describe a profit objective used by many Japanese manufacturing firms.

The maximum quantity of products consumers will buy at given price is shown by a

The ratio of the firm's sales revenues or unit sales to those of the industry (competitors plus the firm itself) is referred to as

According to the profit equation, profit equals

To increase value, marketers may ________, decrease price, or do both.

Which of these statements about the factors that influence demand is true?

The unit variable cost (UVC) equals variable cost (VC) divided by

Figure 13-3 -In Figure 13-3 above, column C represents which type of competitive market?

Figure 13-3 -In Figure 13-3 above, column A represents which type of competitive market?

The practice of simultaneously increasing product and service benefits while maintaining or decreasing price is referred to as

Managing for long-run profits as a pricing objective implies that a company will

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Scanning the Marketing Environment

Ethical and Social Responsibility for Sustainable Marketing

Understanding Consumer Behavior

Understanding Organizations As Customers

Understanding and Reaching Global Consumers and Markets

Marketing Research: From Customer Insights to Actions

Market Segmentation, Targeting, and Positioning

Developing New Products and Services

Managing Successful Products, Services, and Brands

Services Marketing

Arriving at the Final Price

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Using Social Media and Mobile Marketing to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multi-Channel Marketing

Pulling It All Together: the Strategic Marketing Proces

Building an Effective Marketing Plan

Financial Aspects of Marketing

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