Question 1

Rather than emphasize demand, cost, or profit factors, a price setter can stress what ________ doing.

Accepted Answer

A)  the service sector is 
B)  the market or competitors are 
C)  the global economy is 
D)  suppliers are 
E)  the financial markets are 
A)  the service sector is 
B)  the market or competitors are 
C)  the global economy is 
D)  suppliers are 
E)  the financial markets are

Question 2

What is the difference between a one-price policy and a dynamic-price policy?

Accepted Answer

A one-price policy, also called fixed pr

Question 3

In the early 1980s, typical round-trip coach airfares from the East Coast to London were more than $500. Then Freddie Laker introduced the People's Express, a competing service into Newark at $350. Major airlines matched his price and did so until they drove People's Express out of business. Then prices shot back up to over $500. A lawsuit filed under the Sherman Act resulted in a judgment that the major airlines had explicitly tried to destroy a competitor. The People's Express case is an example of ________ on the part of the major airlines.

Accepted Answer

A)  price fixing 
B)  price discrimination 
C)  deceptive pricing 
D)  predatory pricing 
E)  pricing constraints 
A)  price fixing 
B)  price discrimination 
C)  deceptive pricing 
D)  predatory pricing 
E)  pricing constraints

Question 4

Setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it is referred to as

Accepted Answer

A)  skimming pricing. 
B)  status pricing. 
C)  price lining. 
D)  value pricing. 
E)  prestige pricing. 
A)  skimming pricing. 
B)  status pricing. 
C)  price lining. 
D)  value pricing. 
E)  prestige pricing.

Question 5

Elastic demand exists when

Accepted Answer

A)  a small percentage decrease in price produces a smaller percentage increase in quantity demanded. 
B)  a small percentage decrease in price produces a larger percentage increase in quantity demanded. 
C)  an increase in price causes a larger increase in quantity demanded. 
D)  the quantity demanded remains the same regardless of level of price. 
E)  no change in price produces a small percentage change in quantity demanded. 
A)  a small percentage decrease in price produces a smaller percentage increase in quantity demanded. 
B)  a small percentage decrease in price produces a larger percentage increase in quantity demanded. 
C)  an increase in price causes a larger increase in quantity demanded. 
D)  the quantity demanded remains the same regardless of level of price. 
E)  no change in price produces a small percentage change in quantity demanded.

Question 6

Insurance premiums, entrance fees, train fares, and organization dues are all examples of

Accepted Answer

A)  charges. 
B)  countertrade. 
C)  profit. 
D)  price. 
E)  currency. 
A)  charges. 
B)  countertrade. 
C)  profit. 
D)  price. 
E)  currency.

Question 7

Which of the following is an example of a price?

Accepted Answer

A)  tuition 
B)  operating costs 
C)  liquidity 
D)  value 
E)  brand equity 
A)  tuition 
B)  operating costs 
C)  liquidity 
D)  value 
E)  brand equity

Question 8

Which of the following is a profit-oriented approach to pricing?

Accepted Answer

A)  penetration pricing 
B)  target pricing 
C)  loss-leader pricing 
D)  target return-on-investment pricing 
E)  standard markup pricing 
A)  penetration pricing 
B)  target pricing 
C)  loss-leader pricing 
D)  target return-on-investment pricing 
E)  standard markup pricing

Question 9

Prestige pricing refers to

Accepted Answer

A)  charging different prices to different buyers for goods of like grade and quality. 
B)  setting a low initial price on a new product to appeal immediately to the mass market odd-even pricing. 
C)  setting a market price for a product or product class based on a subjective feel for the competitors' price or market price. 
D)  setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it. 
E)  setting a price that is dictated by tradition, a standardized channel of distribution, or other competitive factors. 
A)  charging different prices to different buyers for goods of like grade and quality. 
B)  setting a low initial price on a new product to appeal immediately to the mass market odd-even pricing. 
C)  setting a market price for a product or product class based on a subjective feel for the competitors' price or market price. 
D)  setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it. 
E)  setting a price that is dictated by tradition, a standardized channel of distribution, or other competitive factors.

Question 10

A promotional allowance is

Accepted Answer

A)  a onetime discount to promote the product that must be used within a certain time frame. 
B)  the cash payments or an extra amount of free goods awarded sellers in the marketing channel for undertaking certain advertising or selling activities to promote the product. 
C)  the return of money to promote the product based on proof of purchase. 
D)  a short-term price reduction when consumer demand takes a significant and unexpected dip. 
E)  an incentive, such as trips, cruises, jewelry, etc., presented to brand-loyal customers. 
A)  a onetime discount to promote the product that must be used within a certain time frame. 
B)  the cash payments or an extra amount of free goods awarded sellers in the marketing channel for undertaking certain advertising or selling activities to promote the product. 
C)  the return of money to promote the product based on proof of purchase. 
D)  a short-term price reduction when consumer demand takes a significant and unexpected dip. 
E)  an incentive, such as trips, cruises, jewelry, etc., presented to brand-loyal customers.

Question 11

What is standard markup pricing and when would it be used?

Accepted Answer

Standard markup pricing entails adding a

Question 12

Delta Air Lines offers vacation packages that include airfare, car rental, and lodging. Delta is using a(n) ________ pricing strategy.

Accepted Answer

A)  penetration 
B)  prestige 
C)  bundle 
D)  odd-even 
E)  standard markup 
A)  penetration 
B)  prestige 
C)  bundle 
D)  odd-even 
E)  standard markup

Question 13

A penetration pricing policy is most likely to be effective when which of these is true?

Accepted Answer

A)  Lowering the price has only a minor effect on increasing the sales volume and reducing the unit cost. 
B)  The high initial price will not attract competitors. 
C)  A low initial price discourages competitors from entering the market. 
D)  Customers interpret the high price as signifying high quality. 
E)  Enough prospective customers are willing to buy immediately at the high initial price to make these sales profitable. 
A)  Lowering the price has only a minor effect on increasing the sales volume and reducing the unit cost. 
B)  The high initial price will not attract competitors. 
C)  A low initial price discourages competitors from entering the market. 
D)  Customers interpret the high price as signifying high quality. 
E)  Enough prospective customers are willing to buy immediately at the high initial price to make these sales profitable.

Question 14

If you know the contents and price of a McDonald's Extra Value Meal, it may serve as ________ to you when you visit other fast food restaurants and consider the purchase of a meal option there.

Accepted Answer

A)  a marginal analysis 
B)  a profit equation 
C)  a reference value 
D)  a break-even analysis 
E)  price elasticity of demand 
A)  a marginal analysis 
B)  a profit equation 
C)  a reference value 
D)  a break-even analysis 
E)  price elasticity of demand

Question 15

Which of the following statements about penetration pricing is most accurate?

Accepted Answer

A)  Penetration pricing is a profit-oriented approach to pricing. 
B)  Penetration pricing is a cost-oriented pricing method. 
C)  Penetration pricing encourages competitors to enter a market. 
D)  Penetration pricing is more effective for a price-sensitive market segment. 
E)  Penetration pricing usually precedes a skimming pricing. 
A)  Penetration pricing is a profit-oriented approach to pricing. 
B)  Penetration pricing is a cost-oriented pricing method. 
C)  Penetration pricing encourages competitors to enter a market. 
D)  Penetration pricing is more effective for a price-sensitive market segment. 
E)  Penetration pricing usually precedes a skimming pricing.

Question 16

Figure 11-6a
-In the break-even chart in Figure 11-7a above, the rectangular area EBCD represents the firm's

Accepted Answer

A)  fixed costs. 
B)  break-even point. 
C)  variable costs. 
D)  profit. 
E)  total revenue. 
A)  fixed costs. 
B)  break-even point. 
C)  variable costs. 
D)  profit. 
E)  total revenue.

Question 17

The practice of charging a very low price for a product with the intent of driving competitors out of business is referred to as

Accepted Answer

A)  price fixing. 
B)  predatory pricing. 
C)  price discrimination. 
D)  deceptive pricing. 
E)  geographical pricing. 
A)  price fixing. 
B)  predatory pricing. 
C)  price discrimination. 
D)  deceptive pricing. 
E)  geographical pricing.

Question 18

A firm's profit objective is often measured in terms of ROI. The acronym ROI stands for

Accepted Answer

A)  risk opportunity investment. 
B)  revised organizational incentives. 
C)  return on investment. 
D)  regulated organizational investments. 
E)  replenishment of organizational inventories. 
A)  risk opportunity investment. 
B)  revised organizational incentives. 
C)  return on investment. 
D)  regulated organizational investments. 
E)  replenishment of organizational inventories.

Question 19

Allowances, like discounts, are

Accepted Answer

A)  rewards given to retailers to encourage early payment. 
B)  payment extensions given to cash-strapped consumers during the current recession. 
C)  list price deductions based on surges in consumer demand. 
D)  list price deductions based on sudden drops in consumer demand. 
E)  reductions from list or quoted prices to buyers for performing some activity. 
A)  rewards given to retailers to encourage early payment. 
B)  payment extensions given to cash-strapped consumers during the current recession. 
C)  list price deductions based on surges in consumer demand. 
D)  list price deductions based on sudden drops in consumer demand. 
E)  reductions from list or quoted prices to buyers for performing some activity.

Question 20

Setting a market price for a product or product class based on a subjective feel for the competitors' price or market price as the benchmark is referred to as

Accepted Answer

A)  customary pricing. 
B)  above-, at-, or below-market pricing. 
C)  standard markup pricing. 
D)  competitive margin pricing. 
E)  experience curve pricing. 
A)  customary pricing. 
B)  above-, at-, or below-market pricing. 
C)  standard markup pricing. 
D)  competitive margin pricing. 
E)  experience curve pricing.

Rather than emphasize demand, cost, or profit factors, a price setter can stress what ________ doing.

What is the difference between a one-price policy and a dynamic-price policy?

Setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it is referred to as

Elastic demand exists when

Insurance premiums, entrance fees, train fares, and organization dues are all examples of

Which of the following is an example of a price?

Which of the following is a profit-oriented approach to pricing?

Prestige pricing refers to

A promotional allowance is

What is standard markup pricing and when would it be used?

Delta Air Lines offers vacation packages that include airfare, car rental, and lodging. Delta is using a(n) ________ pricing strategy.

A penetration pricing policy is most likely to be effective when which of these is true?

If you know the contents and price of a McDonald's Extra Value Meal, it may serve as ________ to you when you visit other fast food restaurants and consider the purchase of a meal option there.

Which of the following statements about penetration pricing is most accurate?

Figure 11-6a -In the break-even chart in Figure 11-7a above, the rectangular area EBCD represents the firm's

The practice of charging a very low price for a product with the intent of driving competitors out of business is referred to as

A firm's profit objective is often measured in terms of ROI. The acronym ROI stands for

Allowances, like discounts, are

Setting a market price for a product or product class based on a subjective feel for the competitors' price or market price as the benchmark is referred to as

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility

Understanding Consumer Behavior

Understanding Organizations As Customers

Understanding and Reaching Global Consumers and Markets

Marketing Research: From Customer Insights to Actions

Market Segmentation, Targeting, and Positioning

Developing New Products and Services

Managing Successful Products, Services, and Brands

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Implementing Interactive and Multichannel Marketing

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Using Social Media and Mobile Marketing to Connect With Consumers

Personal Selling and Sales Management

Filters

Exam 11: Pricing Products and Services

Rather than emphasize demand, cost, or profit factors, a price setter can stress what ________ doing.

What is the difference between a one-price policy and a dynamic-price policy?

Setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it is referred to as

Elastic demand exists when

Insurance premiums, entrance fees, train fares, and organization dues are all examples of

Which of the following is an example of a price?

Which of the following is a profit-oriented approach to pricing?

Prestige pricing refers to

A promotional allowance is

What is standard markup pricing and when would it be used?

Delta Air Lines offers vacation packages that include airfare, car rental, and lodging. Delta is using a(n) ________ pricing strategy.

A penetration pricing policy is most likely to be effective when which of these is true?

If you know the contents and price of a McDonald's Extra Value Meal, it may serve as ________ to you when you visit other fast food restaurants and consider the purchase of a meal option there.

Which of the following statements about penetration pricing is most accurate?

Figure 11-6a -In the break-even chart in Figure 11-7a above, the rectangular area EBCD represents the firm's

The practice of charging a very low price for a product with the intent of driving competitors out of business is referred to as

A firm's profit objective is often measured in terms of ROI. The acronym ROI stands for

Allowances, like discounts, are

Setting a market price for a product or product class based on a subjective feel for the competitors' price or market price as the benchmark is referred to as

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility

Understanding Consumer Behavior

Understanding Organizations As Customers

Understanding and Reaching Global Consumers and Markets

Marketing Research: From Customer Insights to Actions

Market Segmentation, Targeting, and Positioning

Developing New Products and Services

Managing Successful Products, Services, and Brands

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Implementing Interactive and Multichannel Marketing

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Using Social Media and Mobile Marketing to Connect With Consumers

Personal Selling and Sales Management

Filters