Exam 16: Pricing Concepts and Strategies

What are allowances? What are the major categories of allowances?

Define price discrimination in today's marketplace and the strategies companies adopt to get around the concept without technically breaking the law. Provide an example.

The following table depicts the marginal revenue and marginal cost at various levels of output. At what level of output is profit maximized? Marginal Revenue and Marginal Cost Output Marginal Revenue Marginal Cost 100 $12 $10 150 12 10 200 14 14 250 14 14

Match each item to the statement or sentence listed below. a.competitive bidding b.penetration pricing strategy c.list price d.trade discount e.price flexibility f.promotional pricing g.loss leader h.cannibalization i.bundle pricing j.odd pricing k.transfer price l.profit centre m.skimming pricing strategy n.competitive pricing strategy o.pricing policy p.market price q.noncumulative quantity discount r.step out s.bot t.cash discount -A(n) _____ is a software program that allows online shoppers to compare prices of a particular product offered by several online retailers.

What is it called when sellers get together and collude to set prices with respect to one or more requests for competitive proposals?

Discuss the elements of breakeven analysis. What are the major weaknesses?

What type of price will a manufacturer be quoting when it quotes the same price for goods (including freight charges) to a buyer in Toronto, another in Calgary, and a third in Vancouver?

Demand for products considered necessities will tend to be inelastic across wide ranges of price.

What are the two common cost-oriented pricing methods?

What is a characteristic of the price-quality relationship, in the absence of other cues?

What type of pricing is "Buy three shock absorbers and get the fourth free," as advertised by an auto repair shop, an example of?

Match each item to the statement or sentence listed below. a.competitive bidding b.penetration pricing strategy c.list price d.trade discount e.price flexibility f.promotional pricing g.loss leader h.cannibalization i.bundle pricing j.odd pricing k.transfer price l.profit centre m.skimming pricing strategy n.competitive pricing strategy o.pricing policy p.market price q.noncumulative quantity discount r.step out s.bot t.cash discount -The process of inviting potential suppliers to quote prices on proposed purchases or contracts is known as _____.

Responding to the weakening of their control over prices brought about by e-commerce, marketers have begun to bundle a host of additional goods and services with the tangible products they offer their customers.

Step outs occur when one company refuses to participate in price escalation between competitors.

Match each item to the statement or sentence listed below. a.competitive bidding b.penetration pricing strategy c.list price d.trade discount e.price flexibility f.promotional pricing g.loss leader h.cannibalization i.bundle pricing j.odd pricing k.transfer price l.profit centre m.skimming pricing strategy n.competitive pricing strategy o.pricing policy p.market price q.noncumulative quantity discount r.step out s.bot t.cash discount -A(n) _____ is a general guideline that reflects marketing objectives and influences specific pricing decisions.

The full-cost approach to pricing allows the marketer to recover all costs, plus an amount added as profit margin.

An internal transfer price is the price for sending goods from one profit centre within the company to another.

Skimming is an effective strategy to use when products are distinctive or have little competition.

What presents a major obstacle to using traditional price theory?

The only real difference among the many cost-plus pricing techniques is the sophistication of the pricing procedures.