Exam 14: Pricing Concepts for Capturing Value

The break-even point is estimated by

Consumers generally believe that ________ is one of the most important factors in their purchase decisions.

Sonja's Sub Shop is located in a business district that has few customers on the weekend. To attract customers on Saturday and Sundays, it reduces its prices on these two days. This is an example of

Price is the cash expenditure plus taxes that consumers must pay for a good or service.

Simon estimates that the fixed costs associated with opening a new bank branch are $500,000. He expects the branch to attract 1,000 new customer accounts in the first year, each of which will cost $50 per year to service. He also expects to generate $100,000 per year in revenue. For Simon, the total cost of opening the new branch and remaining open for one year will be

Fizzy Drinks Inc. decided to generate new sales by being the lowest price competitor in the soft drink market so as to attract customers away from higher-priced producers. What company objective does this reflect?

If all three grocery stores in town decide to charge the same price for a loaf of bread, what type of pricing tactic is being used?

Differentiate between the four levels of competition and offer examples of each type.

What situation is occurring if a 1 percent decrease in price results in more than a 1 percent increase in quantity demand?

In U.S. markets, there are many substitute products for Head & Shoulders dandruff shampoo, suggesting the price elasticity of demand for Head & Shoulders is high.

In one year, the Whispering Leaves Resort incurred $100,000 in fixed costs. Because the resort booked 10,000 room nights, its total variable cost is $100,000 (10,000 room nights × $10 per room). Thus, its total cost is

What is an accurate description of predatory pricing?

Because there are only a few firms in markets with oligopolistic competition,

Cross-price elasticity is the

Isabella knows that her customers always shop for top-of-the-line leather purses and price is not a consideration. She decides to price her line of purses and wallets above those of her closest competition in order to capture those customers who only look for the best. What type of strategy is Isabella using?

A demand curve shows the relationship between ________ during a specific period of time.

How can a company find its way out of a market characterized by pure competition?

In developing marketing strategies, why is price often the most challenging of the four Ps to manage?

Geoff customizes Trek trail bikes. No two bikes are alike. He notices that very few customers even ask the price of his trail bikes before they decide to purchase them. Demand for his trail bikes is probably

Dynamic pricing is in place when retailers charge the same price for goods regardless of the selling season.