Exam 13: Pricing Products and Services

Which of the following is a special kind of price?

Mrs. Renfro's, Inc., is a company that sells 25 different relishes in 45 different states. Mrs. Renfro's chipotle corn salsa is so popular that the company cannot make enough to keep its resellers stocked. Its price of $4.50 for a jar seems just right to consumers who savour its hot and spicy taste. The popularity of hot and spicy food is an example of a(n)_________that Mrs. Renfro's has used to make its product a success.

Assume it costs Lady Marion Seafood, Inc. $30 to catch, process, freeze, package, and ship 5-pound packages of Alaskan salmon. It uses a 60 percent markup on its salmon products and charges customers $48 for a postage-paid vacuum-sealed package. What type of pricing does Lady Marion Seafood use?

Leupold & Stevens, Inc., a North American manufacturer of rifle scopes, uses a variety of pricing strategies for its rifle scopes. For some, the company uses above-, at-, or below-market pricing to reach as many customers as possible. The company is more concerned about making a profit for the complete line of its scopes - rather than making a profit on just one item in its product. Leupold & Stevens uses:

A new startup wants to gain as many users as possible to eventually pay for their service, once they understand the product's value to them. Their first pricing strategy should be one of ________ pricing and then switch to _________to further amass market share.

Often, the earlier a product is in its life cycle:

The pricing model in the text has six distinct steps in the pricing process. Deciding to offer "freemium" pricing would occur in which step?

Which of the following statements about price lining is true?

An analysis of a prospective product shows it is expected to grow by at least 10 percent each year over the next 5 years, and then enter the maturity phase of its product life cycle. This type of analysis would provide useful information in which stage of the price-setting process?

Which of the following is NOT a demand-oriented approach to pricing?

The break-even point for a large grain farming operation was calculated to be 2 million bushels of corn. Break-even analysis would take place in which stage of the price-setting process?

Which of the following is NOT a cost-oriented approach to pricing?

Most government crown organizations in Canada operate in which competitive market?

Central Ice Machine Company is located in Omaha, Nebraska, sells Frick, Sullair, York, and Fes Fuller ammonia refrigeration parts. The company ships using FOB origin pricing. Which of the following statements about the shipment of a Frick reciprocating compressor is true?

When GM purchases 500 tonnes of sheet metal for their manufacturing line, the cost is $0.10 per tonne. However, when they purchase 750 tonnes, the price becomes $0.05 per tonne. GM is receiving a(n)_________from the sheet metal manufacturer.

Carmex Original Formula Lip Products sell as low as $0.99 per jar to $1.79 per jar. The Moisture Plus Formula Lip Products sell between $2.49 and $2.99. Their Moisture Plus line, with its upscale silver tube, is intended to appeal to

What are the six broad objectives that an organization may pursue which tie in directly to the organization's pricing policies?

How do consumers use price as an indicator of value?

The total money received from the sale of a product is called:

Jane Westerlund owns a picture-framing shop, The Caplow Co. The average price she receives for a picture she frames for a customer is $120. This price must cover her average costs for a typical framed picture of $5 for glass, $2 for matting, and $13 for the frame, and $30 for the labour involved. She must also cover monthly expenses of $1,000 for rent and insurance, $200 for heat and electricity, $500 for advertising, and $3,500 for her salary. Assuming everything else stays the same, if Jane Westerlund increased the average price charged for a framed picture, in a break-even chart this would cause the slope of the total revenue curve to _________and the break-even quantity to __________.