Question 1

Reductions for transportation and other costs related to the physical distance between buyer and seller are known as:

Accepted Answer

A)  base-point pricing. 
B)  freight absorption pricing. 
C)  penetration pricing. 
D)  location pricing. 
E)  geographic pricing. 
A)  base-point pricing. 
B)  freight absorption pricing. 
C)  penetration pricing. 
D)  location pricing. 
E)  geographic pricing.

Question 2

Periodic discounting is often predictable, and therefore consumers wait to make purchases so that they can benefit from the price reductions.

Accepted Answer

A) True 
 B)False

Question 3

Scenario 12.4
Use the following to answer the questions.
The BASF Chemical Company in Germany has developed a new rubberized coating. The product is used on cell phones and other hand-held electronic devices that give them protection from falls and scratches. BASF plans to market the product directly to businesses that manufacture the casings for these types of products. BASF currently uses a system of salespeople headquartered in Germany, while its primary business customers are in China.
-Refer to Scenario 12.4. If BASF were to employ pricing that includes the price at the factory plus freight charges from a chosen point nearest the buyer, this would be an example of pricing.

Accepted Answer

A)  factory plus 
B)  dispersion 
C)  F.O.B. destination 
D)  freight absorption 
E)  F.O.B. origin 
A)  factory plus 
B)  dispersion 
C)  F.O.B. destination 
D)  freight absorption 
E)  F.O.B. origin

Question 4

Abby is a marketing consultant who specializes in small businesses. Her current client is very interested in estimating the costs for the coming year, in order to find the break-even point. Abby knows this is an important financial statistic because below the break-even point, the firm operates:

Accepted Answer

A)  with fixed costs only. 
B)  with minimal variable costs. 
C)  with no revenue. 
D)  with minimal profit. 
E)  at a loss. 
A)  with fixed costs only. 
B)  with minimal variable costs. 
C)  with no revenue. 
D)  with minimal profit. 
E)  at a loss.

Question 5

For custom-made equipment or commercial construction projects, which pricing method is most likely used?

Accepted Answer

A)  Prestige 
B)  Premium 
C)  Differential 
D)  Return-on-investment 
E)  Cost-plus 
A)  Prestige 
B)  Premium 
C)  Differential 
D)  Return-on-investment 
E)  Cost-plus

Question 6

Penetration pricing is a new-product pricing approach that provides the most flexible introductory price.

Accepted Answer

A) True 
 B)False

Question 7

The three primary bases for developing prices are:

Accepted Answer

A)  profit, demand, and competition. 
B)  supply, demand, and marketing objectives. 
C)  demand, competition, and cost. 
D)  markup, cost, and cost-plus. 
E)  negotiation, periodicity, and randomness. 
A)  profit, demand, and competition. 
B)  supply, demand, and marketing objectives. 
C)  demand, competition, and cost. 
D)  markup, cost, and cost-plus. 
E)  negotiation, periodicity, and randomness.

Question 8

Scenario 12.1
Use the following to answer the questions.
Concession Supply sells hotdogs, buns, and nacho ingredients to several major league ballparks across the country. Currently, Concession Supply has the following pricing information for one case of hotdogs sold at Wrigley Field: Total fixed costs = $1,200, Selling price = $16, and Variable costs = $6.
-Refer to Scenario 12.1. What is the break-even point in dollar sales volume?

Accepted Answer

A)  $1,200 
B)  $1,440 
C)  $3,000 
D)  $1,920 
E)  $1,600 
A)  $1,200 
B)  $1,440 
C)  $3,000 
D)  $1,920 
E)  $1,600

Question 9

Competition-based pricing is important if competing products are almost homogeneous or if price is the key variable in the marketing strategy.

Accepted Answer

A) True 
 B)False

Question 10

The point at which marginal revenue equals marginal cost is the break-even point.

Accepted Answer

A) True 
 B)False

Question 11

A company wanting to maximize profits from its new product would use product-line pricing.

Accepted Answer

A) True 
 B)False

Question 12

How can transfer prices be calculated?

Accepted Answer

When one unit in an organization sells a

Question 13

Which type of pricing objective can reduce a firm's risk by helping to stabilize demand for its products?

Accepted Answer

A)  Status quo 
B)  Market share 
C)  Survival 
D)  Cash flow 
E)  Return on investment 
A)  Status quo 
B)  Market share 
C)  Survival 
D)  Cash flow 
E)  Return on investment

Question 14

A graph of the quantity of products marketers expect to sell at various prices if other factors remain constant is a:

Accepted Answer

A)  price graph. 
B)  supply curve. 
C)  price/quantity graph. 
D)  marginal revenue curve. 
E)  demand curve. 
A)  price graph. 
B)  supply curve. 
C)  price/quantity graph. 
D)  marginal revenue curve. 
E)  demand curve.

Question 15

Identify and describe six types of psychological pricing.

Accepted Answer

The six types of psychological pricing a

Question 16

If demand is elastic, a change in price causes a parallel change in total revenue.

Accepted Answer

A) True 
 B)False

Question 17

Lucy buys a new dress at T.J. Maxx that has a price tag with "Compare at $150.00, our Price $89.99." This is an example of the use of:

Accepted Answer

A)  bundle pricing. 
B)  cumulative discounts. 
C)  seasonal discounts. 
D)  base-point pricing. 
E)  reference pricing. 
A)  bundle pricing. 
B)  cumulative discounts. 
C)  seasonal discounts. 
D)  base-point pricing. 
E)  reference pricing.

Question 18

The PIMS studies indicates that both market share and are good indicators of profitability.

Accepted Answer

A)  low pricing 
B)  product quality 
C)  limited competition 
D)  sales growth 
E)  ROI pricing 
A)  low pricing 
B)  product quality 
C)  limited competition 
D)  sales growth 
E)  ROI pricing

Question 19

When determining markup as a percentage of cost, divide the markup amount by:

Accepted Answer

A)  price. 
B)  cost. 
C)  quantity. 
D)  revenue. 
E)  100. 
A)  price. 
B)  cost. 
C)  quantity. 
D)  revenue. 
E)  100.

Question 20

If Ralph Lauren offers to reduce the price of its women's blazers when retailers buy more than 100 pieces, the designer is offering a discount.

Accepted Answer

A)  quantity 
B)  cash 
C)  seasonal 
D)  trade 
E)  complementary 
A)  quantity 
B)  cash 
C)  seasonal 
D)  trade 
E)  complementary

Reductions for transportation and other costs related to the physical distance between buyer and seller are known as:

Periodic discounting is often predictable, and therefore consumers wait to make purchases so that they can benefit from the price reductions.

Abby is a marketing consultant who specializes in small businesses. Her current client is very interested in estimating the costs for the coming year, in order to find the break-even point. Abby knows this is an important financial statistic because below the break-even point, the firm operates:

For custom-made equipment or commercial construction projects, which pricing method is most likely used?

Penetration pricing is a new-product pricing approach that provides the most flexible introductory price.

The three primary bases for developing prices are:

Competition-based pricing is important if competing products are almost homogeneous or if price is the key variable in the marketing strategy.

The point at which marginal revenue equals marginal cost is the break-even point.

A company wanting to maximize profits from its new product would use product-line pricing.

How can transfer prices be calculated?

Which type of pricing objective can reduce a firm's risk by helping to stabilize demand for its products?

A graph of the quantity of products marketers expect to sell at various prices if other factors remain constant is a:

Identify and describe six types of psychological pricing.

If demand is elastic, a change in price causes a parallel change in total revenue.

Lucy buys a new dress at T.J. Maxx that has a price tag with "Compare at $150.00, our Price $89.99." This is an example of the use of:

The PIMS studies indicates that both market share and are good indicators of profitability.

When determining markup as a percentage of cost, divide the markup amount by:

If Ralph Lauren offers to reduce the price of its women's blazers when retailers buy more than 100 pieces, the designer is offering a discount.

Customer-Driven Strategic Marketing

Planning, Implementing, and Evaluating Marketing Strategies

The Marketing Environment, Social Responsibility, and Ethics

Marketing Research and Information Systems

Target Markets: Segmentation and Evaluation

Consumer Buying Behavior

Business Markets and Buying Behavior

Reaching Global Markets

Digital Marketing and Social Networking

Product, Branding, and Packaging Concepts

Developing and Managing Goods and Services

Marketing Channels and Supply-Chain Management

Retailing, Direct Marketing, and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Filters

Exam 12: Pricing Concepts and Management

Reductions for transportation and other costs related to the physical distance between buyer and seller are known as:

Periodic discounting is often predictable, and therefore consumers wait to make purchases so that they can benefit from the price reductions.

Abby is a marketing consultant who specializes in small businesses. Her current client is very interested in estimating the costs for the coming year, in order to find the break-even point. Abby knows this is an important financial statistic because below the break-even point, the firm operates:

For custom-made equipment or commercial construction projects, which pricing method is most likely used?

Penetration pricing is a new-product pricing approach that provides the most flexible introductory price.

The three primary bases for developing prices are:

Competition-based pricing is important if competing products are almost homogeneous or if price is the key variable in the marketing strategy.

The point at which marginal revenue equals marginal cost is the break-even point.

A company wanting to maximize profits from its new product would use product-line pricing.

How can transfer prices be calculated?

Which type of pricing objective can reduce a firm's risk by helping to stabilize demand for its products?

A graph of the quantity of products marketers expect to sell at various prices if other factors remain constant is a:

Identify and describe six types of psychological pricing.

If demand is elastic, a change in price causes a parallel change in total revenue.

Lucy buys a new dress at T.J. Maxx that has a price tag with "Compare at $150.00, our Price $89.99." This is an example of the use of:

The PIMS studies indicates that both market share and are good indicators of profitability.

When determining markup as a percentage of cost, divide the markup amount by:

If Ralph Lauren offers to reduce the price of its women's blazers when retailers buy more than 100 pieces, the designer is offering a discount.

Customer-Driven Strategic Marketing

Planning, Implementing, and Evaluating Marketing Strategies

The Marketing Environment, Social Responsibility, and Ethics

Marketing Research and Information Systems

Target Markets: Segmentation and Evaluation

Consumer Buying Behavior

Business Markets and Buying Behavior

Reaching Global Markets

Digital Marketing and Social Networking

Product, Branding, and Packaging Concepts

Developing and Managing Goods and Services

Marketing Channels and Supply-Chain Management

Retailing, Direct Marketing, and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Filters