Question 1

All of the following are included in the five Cs of pricing except

Accepted Answer

A)  customers. 
B)  channel members. 
C)  cost. 
D)  collaboration. 
E)  company objectives. 
A)  customers. 
B)  channel members. 
C)  cost. 
D)  collaboration. 
E)  company objectives.

Question 2

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

Accepted Answer

A)  income and demand 
B)  price and costs 
C)  price and elasticity 
D)  profit and price 
E)  price and demand 
A)  income and demand 
B)  price and costs 
C)  price and elasticity 
D)  profit and price 
E)  price and demand

Question 3

Diane owns a bakery where she sells cupcakes. Two blocks down there is another bakery, CC's Bakery, that sells cupcakes for $1 less than Diane. Diane decides to lower her price and match CC's Bakery prices. What type of pricing strategy is Diane implementing?

Accepted Answer

A)  internal pricing 
B)  profit-oriented pricing 
C)  competitor-oriented pricing 
D)  customer-oriented pricing 
E)  sales-oriented pricing 
A)  internal pricing 
B)  profit-oriented pricing 
C)  competitor-oriented pricing 
D)  customer-oriented pricing 
E)  sales-oriented pricing

Question 4

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

Accepted Answer

A)  because most managers feel it is the least important element of the marketing mix 
B)  because it is the least understood element of the marketing mix 
C)  because it has to be based on the promotion budget for the product 
D)  because it is difficult to calculate markups for products 
E)  because managers don't understand the relationship between benefits and costs 
A)  because most managers feel it is the least important element of the marketing mix 
B)  because it is the least understood element of the marketing mix 
C)  because it has to be based on the promotion budget for the product 
D)  because it is difficult to calculate markups for products 
E)  because managers don't understand the relationship between benefits and costs

Question 5

Sharon knew that her established customers liked her product much better than her competitor's. She was planning to expand into new markets, and she was considering pricing. She was leaning toward charging a higher price than competitors to help demonstrate that hers was a high-quality product. Sharon was considering

Accepted Answer

A)  a top of market strategy. 
B)  the value of quality. 
C)  advantageous pricing. 
D)  premium pricing. 
E)  differential pricing. 
A)  a top of market strategy. 
B)  the value of quality. 
C)  advantageous pricing. 
D)  premium pricing. 
E)  differential pricing.

Question 6

When Ursula decides how to price new products in her gift store, she measures the value of her product offerings against those of the other stores in her area. Ursula uses a ________ pricing strategy.

Accepted Answer

A)  maximizing profits 
B)  target profit 
C)  target return 
D)  competitor-oriented 
E)  sales oriented 
A)  maximizing profits 
B)  target profit 
C)  target return 
D)  competitor-oriented 
E)  sales oriented

Question 7

There is an old saying "If you have to ask the price of a yacht, you cannot afford it." Products like yachts are most likely to be associated with

Accepted Answer

A)  cross-shopping. 
B)  competitive parity pricing. 
C)  target return value. 
D)  prestige pricing. 
E)  break-even point pricing. 
A)  cross-shopping. 
B)  competitive parity pricing. 
C)  target return value. 
D)  prestige pricing. 
E)  break-even point pricing.

Question 8

When a firm colludes with other firms to control prices, it is engaging in

Accepted Answer

A)  competitive favoritism. 
B)  industry tightening. 
C)  monopolistic competition. 
D)  price fixing. 
E)  regressive pricing. 
A)  competitive favoritism. 
B)  industry tightening. 
C)  monopolistic competition. 
D)  price fixing. 
E)  regressive pricing.

Question 9

Pure competition occurs when there are many firms competing for customers in a given market but their products are differentiated.

Accepted Answer

A) True 
 B)False

Question 10

In many high-end resort markets, Westin hotels compete directly with Crown Plaza hotels. When it comes to pricing, Westin tends to charge its guests similar rates to what the Crown Plaza hotels charge. Westin is using a ________ pricing strategy.

Accepted Answer

A)  maximizing profits 
B)  target profit 
C)  target return 
D)  competitive parity 
E)  sales oriented 
A)  maximizing profits 
B)  target profit 
C)  target return 
D)  competitive parity 
E)  sales oriented

Question 11

For market penetration pricing to work, the product or service must be perceived as breaking new ground in some way.

Accepted Answer

A) True 
 B)False

Question 12

Brad always buys and uses Nike brand golf balls. If he finds a Titleist or Callaway ball in the rough, he gives it away. Brand-loyal golfers like Brad allow Nike to charge a higher price and not lose many sales. By building a strong brand, Nike has effectively

Accepted Answer

A)  increased the income effect for its products. 
B)  increased the cross-price elasticity for its products. 
C)  focused on the competitive parity point for its products. 
D)  shifted the golf ball market from a monopoly to pure competition. 
E)  reduced the price elasticity of demand for its products. 
A)  increased the income effect for its products. 
B)  increased the cross-price elasticity for its products. 
C)  focused on the competitive parity point for its products. 
D)  shifted the golf ball market from a monopoly to pure competition. 
E)  reduced the price elasticity of demand for its products.

Question 13

The observation that consumers are generally more sensitive to price increases than to price decreases suggests that

Accepted Answer

A)  most consumers cannot remember what price they paid the last time they bought a particular product. 
B)  it is easier to lose customers with a price increase than to gain customers with a price decrease. 
C)  most consumers would rather skip buying a product than pay a higher price. 
D)  most consumers are emotionally attached to their favorite products and are unlikely to change, even if the price changes. 
E)  firms gain more customers with price decreases than they lose with price increases. 
A)  most consumers cannot remember what price they paid the last time they bought a particular product. 
B)  it is easier to lose customers with a price increase than to gain customers with a price decrease. 
C)  most consumers would rather skip buying a product than pay a higher price. 
D)  most consumers are emotionally attached to their favorite products and are unlikely to change, even if the price changes. 
E)  firms gain more customers with price decreases than they lose with price increases.

Question 14

Predatory pricing

Accepted Answer

A)  is legal in the United States. 
B)  occurs when a firm sets a very high price for one or more of its products. 
C)  is illegal in the United States under both the Sherman Antitrust Act and the Federal Trade Commission Act. 
D)  is legal in the United States when a company wants to set a very low price to drive its competition out of business. 
E)  occurs when there are many firms competing for customers in a given market but their products are differentiated. 
A)  is legal in the United States. 
B)  occurs when a firm sets a very high price for one or more of its products. 
C)  is illegal in the United States under both the Sherman Antitrust Act and the Federal Trade Commission Act. 
D)  is legal in the United States when a company wants to set a very low price to drive its competition out of business. 
E)  occurs when there are many firms competing for customers in a given market but their products are differentiated.

Question 15

Julia wants her firm's gourmet snacks to be the leading brand in the U.S. market. When adopting a pricing strategy designed to gain market share, she should remember that

Accepted Answer

A)  rarely is the lowest-price offering the dominant brand in a market. 
B)  prestige products need to be competitively priced. 
C)  companies can gain market share by offering low-quality products at a high price. 
D)  total value equals total cost minus variable costs leading to price escalation. 
E)  price wars are the way to become the dominant brand. 
A)  rarely is the lowest-price offering the dominant brand in a market. 
B)  prestige products need to be competitively priced. 
C)  companies can gain market share by offering low-quality products at a high price. 
D)  total value equals total cost minus variable costs leading to price escalation. 
E)  price wars are the way to become the dominant brand.

Question 16

Natalie operates on a pretty tight budget. She is a price-conscious shopper and usually buys store or generic brands to save money. Recently, however, Natalie was given a pretty substantial raise. As such, she has altered her shopping patterns and now regularly buys more expensive, name-brand goods. This is an example of

Accepted Answer

A)  the substitution effect. 
B)  the price inelasticity coefficient. 
C)  the income effect. 
D)  the target return effect. 
E)  cross-price elasticity. 
A)  the substitution effect. 
B)  the price inelasticity coefficient. 
C)  the income effect. 
D)  the target return effect. 
E)  cross-price elasticity.

Question 17

At the break-even point,

Accepted Answer

A)  costs are zero. 
B)  price is maximized. 
C)  profits are zero. 
D)  fixed costs are zero. 
E)  contribution per unit is zero. 
A)  costs are zero. 
B)  price is maximized. 
C)  profits are zero. 
D)  fixed costs are zero. 
E)  contribution per unit is zero.

Question 18

Explain how the demand curve works, and how it benefits a firm.

Accepted Answer

A demand curve shows how many units of a

Question 19

Explain the difference between fixed and variable costs and provide examples of each.

Accepted Answer

Fixed costs are those costs that remain

Question 20

A customer orientation toward pricing implicitly invokes the concept of

Accepted Answer

A)  knowing the dimensions of the target market. 
B)  positioning. 
C)  the income effect. 
D)  value. 
E)  profit. 
A)  knowing the dimensions of the target market. 
B)  positioning. 
C)  the income effect. 
D)  value. 
E)  profit.

All of the following are included in the five Cs of pricing except

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

Diane owns a bakery where she sells cupcakes. Two blocks down there is another bakery, CC's Bakery, that sells cupcakes for $1 less than Diane. Diane decides to lower her price and match CC's Bakery prices. What type of pricing strategy is Diane implementing?

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

When Ursula decides how to price new products in her gift store, she measures the value of her product offerings against those of the other stores in her area. Ursula uses a ________ pricing strategy.

There is an old saying "If you have to ask the price of a yacht, you cannot afford it." Products like yachts are most likely to be associated with

When a firm colludes with other firms to control prices, it is engaging in

Pure competition occurs when there are many firms competing for customers in a given market but their products are differentiated.

In many high-end resort markets, Westin hotels compete directly with Crown Plaza hotels. When it comes to pricing, Westin tends to charge its guests similar rates to what the Crown Plaza hotels charge. Westin is using a ________ pricing strategy.

For market penetration pricing to work, the product or service must be perceived as breaking new ground in some way.

Brad always buys and uses Nike brand golf balls. If he finds a Titleist or Callaway ball in the rough, he gives it away. Brand-loyal golfers like Brad allow Nike to charge a higher price and not lose many sales. By building a strong brand, Nike has effectively

The observation that consumers are generally more sensitive to price increases than to price decreases suggests that

Predatory pricing

Julia wants her firm's gourmet snacks to be the leading brand in the U.S. market. When adopting a pricing strategy designed to gain market share, she should remember that

At the break-even point,

Explain how the demand curve works, and how it benefits a firm.

Explain the difference between fixed and variable costs and provide examples of each.

A customer orientation toward pricing implicitly invokes the concept of

Overview of Marketing

Developing Marketing Strategies and a Marketing Plan

Social and Mobile Marketing

Conscious Marketing, Corporate Social Responsibility, and Ethics

Analyzing the Marketing Environment

Consumer Behavior

Business-To-Business Marketing

Global Marketing

Segmentation, Targeting, and Positioning

Marketing Research

Product, Branding, and Packaging Decisions

Developing New Products

Services: the Intangible Product

Supply Chain and Channel Management

Retailing and Omnichannel Marketing

Integrated Marketing Communications

Advertising, Public Relations, and Sales Promotions

Personal Selling and Sales Management

Filters

Exam 14: Pricing Concepts for Establishing Value

All of the following are included in the five Cs of pricing except

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

Diane owns a bakery where she sells cupcakes. Two blocks down there is another bakery, CC's Bakery, that sells cupcakes for $1 less than Diane. Diane decides to lower her price and match CC's Bakery prices. What type of pricing strategy is Diane implementing?

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

When Ursula decides how to price new products in her gift store, she measures the value of her product offerings against those of the other stores in her area. Ursula uses a ________ pricing strategy.

There is an old saying "If you have to ask the price of a yacht, you cannot afford it." Products like yachts are most likely to be associated with

When a firm colludes with other firms to control prices, it is engaging in

Pure competition occurs when there are many firms competing for customers in a given market but their products are differentiated.

In many high-end resort markets, Westin hotels compete directly with Crown Plaza hotels. When it comes to pricing, Westin tends to charge its guests similar rates to what the Crown Plaza hotels charge. Westin is using a ________ pricing strategy.

For market penetration pricing to work, the product or service must be perceived as breaking new ground in some way.

Brad always buys and uses Nike brand golf balls. If he finds a Titleist or Callaway ball in the rough, he gives it away. Brand-loyal golfers like Brad allow Nike to charge a higher price and not lose many sales. By building a strong brand, Nike has effectively

The observation that consumers are generally more sensitive to price increases than to price decreases suggests that

Predatory pricing

Julia wants her firm's gourmet snacks to be the leading brand in the U.S. market. When adopting a pricing strategy designed to gain market share, she should remember that

At the break-even point,

Explain how the demand curve works, and how it benefits a firm.

Explain the difference between fixed and variable costs and provide examples of each.

A customer orientation toward pricing implicitly invokes the concept of

Overview of Marketing

Developing Marketing Strategies and a Marketing Plan

Social and Mobile Marketing

Conscious Marketing, Corporate Social Responsibility, and Ethics

Analyzing the Marketing Environment

Consumer Behavior

Business-To-Business Marketing

Global Marketing

Segmentation, Targeting, and Positioning

Marketing Research

Product, Branding, and Packaging Decisions

Developing New Products

Services: the Intangible Product

Supply Chain and Channel Management

Retailing and Omnichannel Marketing

Integrated Marketing Communications

Advertising, Public Relations, and Sales Promotions

Personal Selling and Sales Management

Filters