Question 1

If a company increased its price from $100 to $120 and the quantity demanded fell by 40%, the price elasticity of demand for this product is

Accepted Answer

A)  2. 
B)  1/2. 
C)  −1/2. 
D)  −2. 
E)  4. 
A)  2. 
B)  1/2. 
C)  −1/2. 
D)  −2. 
E)  4.

Question 2

James McGee is a sales representative for Canon Business Solutions and his territory includes St. Louis and the surrounding suburbs. James has a variety of printers, copiers, and document solutions that he provides to companies ranging from educational institutions, government offices, and small to medium-sized businesses. One of his accounts in the St. Louis area is Cintas, which offers a wide range of products to businesses. James was working with the St. Louis division manager, Stephanie Miller, to gain her approval to purchase a networked printer and copier for their 50-person office. The cost of the printer/copier including installation would be $5,490, but Stephanie told James that they could only spend $5,000, and in order to get the order, James would have to provide a 10% discount. James started thinking about how to add value to the proposal and asked Stephanie if Cintas would consider some type of a trade. After a friendly discussion as to how Cintas could provide an exchange of product to Canon Business Solutions, they agreed to a deal of $5,000 plus Cintas would deliver and maintain welcome mats or rugs in Canon's St. Louis office and provide disinfectants and a scent machine for the bathrooms. James and Stephanie successfully utilized _____ to facilitate the exchange.

Accepted Answer

A)  bartering 
B)  money 
C)  credit 
D)  negotiation 
E)  trade 
A)  bartering 
B)  money 
C)  credit 
D)  negotiation 
E)  trade

Question 3

Price wars tend to be disadvantageous to retailers. Why, therefore, would a retailer want to lower prices and take the chance of inciting a price war?

Accepted Answer

A)  To reduce long-term costs 
B)  To raise profit margins 
C)  To develop a sustainable advantage 
D)  To enter a new market 
E)  To boost market share 
A)  To reduce long-term costs 
B)  To raise profit margins 
C)  To develop a sustainable advantage 
D)  To enter a new market 
E)  To boost market share

Question 4

Ryan orders 16 dozen fishing lures from Strike Right for $375. When he gets the invoice, he is furious that $25 in freight charges has been tacked onto his bill because he thought the price included freight costs. Ryan should have been certain that the order terms were

Accepted Answer

A)  F.O.b. origin. 
B)  F.O.b. factory. 
C)  C.O.D. 
D)  2/10, n/30. 
E)  F.O.b. destination. 
A)  F.O.b. origin. 
B)  F.O.b. factory. 
C)  C.O.D. 
D)  2/10, n/30. 
E)  F.O.b. destination.

Question 5

If Carnival Cruise Lines increased the price of its seven-day cruise package by 10% and, as a result, experienced a 20% decline in customer bookings, Carnival's demand would be

Accepted Answer

A)  steady. 
B)  inelastic. 
C)  elastic. 
D)  prestige. 
E)  marginal. 
A)  steady. 
B)  inelastic. 
C)  elastic. 
D)  prestige. 
E)  marginal.

Question 6

For most products, the quantity demanded goes up as the price goes down.

Accepted Answer

A) True 
 B)False

Question 7

Price is the value that is exchanged for products in a marketing transaction.

Accepted Answer

A) True 
 B)False

Question 8

Price should be defined in terms of money only.

Accepted Answer

A) True 
 B)False

Question 9

Jared is developing a business plan for a new type of bicycle helmet. He is interested in finding the point at which the costs of producing the helmet will equal the revenue earned from selling the product. Jared is interested in finding the

Accepted Answer

A)  elasticity of demand. 
B)  breakeven point. 
C)  variable costs. 
D)  price elasticity. 
E)  the sum of fixed costs. 
A)  elasticity of demand. 
B)  breakeven point. 
C)  variable costs. 
D)  price elasticity. 
E)  the sum of fixed costs.

Question 10

Producers commonly provide discounts off list prices to intermediaries.

Accepted Answer

A) True 
 B)False

Question 11

Price is the most easily adjusted ingredient in the marketing mix.

Accepted Answer

A) True 
 B)False

Question 12

To maintain market share and revenue in an increasingly price-sensitive market, companies have focused on quality, used labor-saving technologies, and used efficient manufacturing processes. These tactics have provided gains in productivity that have translated into ____ for the consumer.

Accepted Answer

A)  higher costs for the company and higher prices 
B)  higher costs for the company and lower prices 
C)  lower costs for the company and lower prices 
D)  lower costs for the company and higher prices 
E)  no change in the costs for either the company or 
A)  higher costs for the company and higher prices 
B)  higher costs for the company and lower prices 
C)  lower costs for the company and lower prices 
D)  lower costs for the company and higher prices 
E)  no change in the costs for either the company or

Question 13

Provisions of the Robinson-Patman Act, as well as those of the ____, limit the use of price differentials.

Accepted Answer

A)  Simpson-Marshall Act 
B)  Federal Trade Commission Act 
C)  Wheeler-Lea Act 
D)  Clayton Act 
E)  Sherman Antitrust Act 
A)  Simpson-Marshall Act 
B)  Federal Trade Commission Act 
C)  Wheeler-Lea Act 
D)  Clayton Act 
E)  Sherman Antitrust Act

Question 14

Suppose managers at Caterpillar have determined the costs associated with producing hay balers are equal to the price that they charge for the hay balers. This indicates that Caterpillar is producing at the ____ point.

Accepted Answer

A)  breakeven 
B)  marginal revenue less than marginal cost 
C)  profit margin 
D)  competitive price 
E)  profit maximizing 
A)  breakeven 
B)  marginal revenue less than marginal cost 
C)  profit margin 
D)  competitive price 
E)  profit maximizing

Question 15

Product demand usually becomes more elastic over time because more substitutes are found.

Accepted Answer

A) True 
 B)False

Question 16

Price elasticity of demand measures the sensitivity of demand to changes in price.

Accepted Answer

A) True 
 B)False

Question 17

F.O.b. factory denotes the price of the products at the factory. If the price is quoted as F.O.b. shipping, then shipping costs are paid by the seller.

Accepted Answer

A) True 
 B)False

Question 18

Naomi Spoor works for IBM as a district manager and travels frequently for business. She enjoys fashion and is always dressed in a stylish suit with stiletto heels. She's an avid reader of fashion blogs and magazines and shops the high-end stores in New York City, Boston, Chicago, or Los Angeles when she's in those locations as part of her corporate travel. Naomi's favorite brand of shoe is Christian Louboutin, which features the distinctive red sole. Although the shoes cost over $900 per pair, Naomi has between four and six pairs in her closet and believes they are the most stylish and comfortable dress shoe. She also likes the subtle feature of the red soles, which are very distinctive and signify that the shoes are expensive and made by the famous French designer. Which of the following best describes Naomi's purchasing style for the Christian Louboutin shoes?

Accepted Answer

A)  Prestige-sensitive 
B)  Value-conscious 
C)  Price-conscious 
D)  Quality-conscious 
E)  Economy-sensitive 
A)  Prestige-sensitive 
B)  Value-conscious 
C)  Price-conscious 
D)  Quality-conscious 
E)  Economy-sensitive

Question 19

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)  internal referencing. 
B)  cumulative discounts. 
C)  seasonal discounts. 
D)  base-point pricing. 
E)  an external reference price. 
A)  internal referencing. 
B)  cumulative discounts. 
C)  seasonal discounts. 
D)  base-point pricing. 
E)  an external reference price.

Question 20

Which of the following is true about non-price competition?

Accepted Answer

A)  A major advantage of nonprice competition is flexibility. 
B)  Nonprice competition does not allow the marketer to build brand loyalty. 
C)  Price wars may result from nonprice competition. 
D)  In nonprice competition, marketers distinguish their brands with unique product features. 
E)  In nonprice competition, marketers do not use promotion. 
A)  A major advantage of nonprice competition is flexibility. 
B)  Nonprice competition does not allow the marketer to build brand loyalty. 
C)  Price wars may result from nonprice competition. 
D)  In nonprice competition, marketers distinguish their brands with unique product features. 
E)  In nonprice competition, marketers do not use promotion.

If a company increased its price from $100 to $120 and the quantity demanded fell by 40%, the price elasticity of demand for this product is

Price wars tend to be disadvantageous to retailers. Why, therefore, would a retailer want to lower prices and take the chance of inciting a price war?

Ryan orders 16 dozen fishing lures from Strike Right for $375. When he gets the invoice, he is furious that $25 in freight charges has been tacked onto his bill because he thought the price included freight costs. Ryan should have been certain that the order terms were

If Carnival Cruise Lines increased the price of its seven-day cruise package by 10% and, as a result, experienced a 20% decline in customer bookings, Carnival's demand would be

For most products, the quantity demanded goes up as the price goes down.

Price is the value that is exchanged for products in a marketing transaction.

Price should be defined in terms of money only.

Jared is developing a business plan for a new type of bicycle helmet. He is interested in finding the point at which the costs of producing the helmet will equal the revenue earned from selling the product. Jared is interested in finding the

Producers commonly provide discounts off list prices to intermediaries.

Price is the most easily adjusted ingredient in the marketing mix.

To maintain market share and revenue in an increasingly price-sensitive market, companies have focused on quality, used labor-saving technologies, and used efficient manufacturing processes. These tactics have provided gains in productivity that have translated into ____ for the consumer.

Provisions of the Robinson-Patman Act, as well as those of the ____, limit the use of price differentials.

Suppose managers at Caterpillar have determined the costs associated with producing hay balers are equal to the price that they charge for the hay balers. This indicates that Caterpillar is producing at the ____ point.

Product demand usually becomes more elastic over time because more substitutes are found.

Price elasticity of demand measures the sensitivity of demand to changes in price.

F.O.b. factory denotes the price of the products at the factory. If the price is quoted as F.O.b. shipping, then shipping costs are paid by the seller.

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

Which of the following is true about non-price competition?

An Overview of Strategic Marketing

Planning, Implementing, and Evaluating Marketing Strategies

The Marketing Environment

Social Responsibility and Ethics in Marketing

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 Concepts, Branding, and Packaging

Developing and Managing Products

Services Marketing

Marketing Channels and Supply Chain Management

Retailing, Direct Marketing and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Setting Prices

Filters

Exam 19: Pricing Concepts

If a company increased its price from $100 to $120 and the quantity demanded fell by 40%, the price elasticity of demand for this product is

Price wars tend to be disadvantageous to retailers. Why, therefore, would a retailer want to lower prices and take the chance of inciting a price war?

Ryan orders 16 dozen fishing lures from Strike Right for $375. When he gets the invoice, he is furious that $25 in freight charges has been tacked onto his bill because he thought the price included freight costs. Ryan should have been certain that the order terms were

If Carnival Cruise Lines increased the price of its seven-day cruise package by 10% and, as a result, experienced a 20% decline in customer bookings, Carnival's demand would be

For most products, the quantity demanded goes up as the price goes down.

Price is the value that is exchanged for products in a marketing transaction.

Price should be defined in terms of money only.

Jared is developing a business plan for a new type of bicycle helmet. He is interested in finding the point at which the costs of producing the helmet will equal the revenue earned from selling the product. Jared is interested in finding the

Producers commonly provide discounts off list prices to intermediaries.

Price is the most easily adjusted ingredient in the marketing mix.

To maintain market share and revenue in an increasingly price-sensitive market, companies have focused on quality, used labor-saving technologies, and used efficient manufacturing processes. These tactics have provided gains in productivity that have translated into ____ for the consumer.

Provisions of the Robinson-Patman Act, as well as those of the ____, limit the use of price differentials.

Suppose managers at Caterpillar have determined the costs associated with producing hay balers are equal to the price that they charge for the hay balers. This indicates that Caterpillar is producing at the ____ point.

Product demand usually becomes more elastic over time because more substitutes are found.

Price elasticity of demand measures the sensitivity of demand to changes in price.

F.O.b. factory denotes the price of the products at the factory. If the price is quoted as F.O.b. shipping, then shipping costs are paid by the seller.

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

Which of the following is true about non-price competition?

An Overview of Strategic Marketing

Planning, Implementing, and Evaluating Marketing Strategies

The Marketing Environment

Social Responsibility and Ethics in Marketing

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 Concepts, Branding, and Packaging

Developing and Managing Products

Services Marketing

Marketing Channels and Supply Chain Management

Retailing, Direct Marketing and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Setting Prices

Filters