Question 1

Which of the following is not a discount provided to business customers?

Accepted Answer

A)  Trade 
B)  Cumulative 
C)  Cash 
D)  Seasonal 
E)  Differentiated 
A)  Trade 
B)  Cumulative 
C)  Cash 
D)  Seasonal 
E)  Differentiated

Question 2

A pricing strategy is a course of action designed to achieve pricing and marketing objectives.

Accepted Answer

A) True 
 B)False

Question 3

The local florist advertises a discount on arrangements during the month of April because the anniversary of the store's opening is in April. This is an example of special-event pricing.

Accepted Answer

A) True 
 B)False

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

A retailer of Real Dry deodorant prices it at $2.00; it costs the retailer $1.40. What is the approximate markup as a percentage of selling price?

Accepted Answer

A)  3 percent 
B)  14.3 percent 
C)  30 percent 
D)  70 percent 
E)  20 percent 
A)  3 percent 
B)  14.3 percent 
C)  30 percent 
D)  70 percent 
E)  20 percent

Question 6

The idea behind prestige demand is that many prestige products seem to sell better at a high price than at a low price.

Accepted Answer

A) True 
 B)False

Question 7

A price-leader approach is a pricing approach most often used in supermarkets to attract consumers by giving them special low prices on a few items.

Accepted Answer

A) True 
 B)False

Question 8

If a product has an inelastic demand and the manufacturer raises its price,

Accepted Answer

A)  total revenue will increase. 
B)  quantity demanded will decrease. 
C)  the demand schedule will shift. 
D)  the demand will become more inelastic. 
E)  total revenue will decrease. 
A)  total revenue will increase. 
B)  quantity demanded will decrease. 
C)  the demand schedule will shift. 
D)  the demand will become more inelastic. 
E)  total revenue will decrease.

Question 9

Both the Federal Trade Commission Act and the Wheeler-Lea Act prohibit

Accepted Answer

A)  freezing prices. 
B)  independent pricing policies. 
C)  deceptive pricing. 
D)  price fixing. 
E)  price differentials. 
A)  freezing prices. 
B)  independent pricing policies. 
C)  deceptive pricing. 
D)  price fixing. 
E)  price differentials.

Question 10

Ethan is an operations unit manager for Morningstar Foods. So far in developing his monthly budget, he has identified the following costs: Overhead at $120,000; Packaging at $70,000; Advertising at $60,000; Salaries at $400,000; Food production at $90,000, and Distribution at $22,000. The fixed costs in this situation would be

Accepted Answer

A)  overhead, packaging, advertising, salaries, food production, and distribution 
B)  overhead, packaging, advertising, salaries, and distribution 
C)  overhead, advertising, distribution, and salaries 
D)  overhead, advertising, and salaries 
E)  overhead 
A)  overhead, packaging, advertising, salaries, food production, and distribution 
B)  overhead, packaging, advertising, salaries, and distribution 
C)  overhead, advertising, distribution, and salaries 
D)  overhead, advertising, and salaries 
E)  overhead

Question 11

Organizational goals have little to do with pricing decisions.

Accepted Answer

A) True 
 B)False

Question 12

Comparison of various prices and various breakeven points will tell the marketer exactly what price to charge.

Accepted Answer

A) True 
 B)False

Question 13

Demand is best determined by a top management committee.

Accepted Answer

A) True 
 B)False

Question 14

Changes in buyers' attitudes, other components of the marketing mix, and uncontrollable environmental factors can influence demand.

Accepted Answer

A) True 
 B)False

Question 15

Seasonal discounts provide price incentives to customers during peak selling seasons.

Accepted Answer

A) True 
 B)False

Question 16

Suppose that the frozen foods division of Swanson purchases food trays and boxes from the packaging division. The form of pricing used to charge the frozen foods division is called

Accepted Answer

A)  zone pricing. 
B)  base-point pricing. 
C)  business-unit pricing. 
D)  transfer pricing. 
E)  price discrimination. 
A)  zone pricing. 
B)  base-point pricing. 
C)  business-unit pricing. 
D)  transfer pricing. 
E)  price discrimination.

Question 17

Random discounting means discounting various products on a systematic basis.

Accepted Answer

A) True 
 B)False

Question 18

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 19

Cost-based pricing strategies result in a percentage being added to the cost of the product.

Accepted Answer

A) True 
 B)False

Question 20

Scenario 12.2 Use the following to answer the questions.
The BASF Chemical Company in Germany has developed a new rubberized coating. The product has an application for cell phones and other hand-held electronic devices that gives them protection from falls and scratches. BASF plans to market the product directly to businesses that manufacture the casings for these types of products. BASF currently uses a system of salespeople headquartered in Germany, while its primary business customers are in China.
Refer to Scenario 12.2. If BASF were to employ pricing that includes the price at the factory plus freight charges from a chosen point nearest the buyer, this would be an example of ____ pricing.

Accepted Answer

A)  factory plus 
B)  dispersion 
C)  base-point 
D)  freight absorption 
E)  uniform geographic 
A)  factory plus 
B)  dispersion 
C)  base-point 
D)  freight absorption 
E)  uniform geographic

Which of the following is not a discount provided to business customers?

A pricing strategy is a course of action designed to achieve pricing and marketing objectives.

The local florist advertises a discount on arrangements during the month of April because the anniversary of the store's opening is in April. This is an example of special-event pricing.

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

A retailer of Real Dry deodorant prices it at $2.00; it costs the retailer $1.40. What is the approximate markup as a percentage of selling price?

The idea behind prestige demand is that many prestige products seem to sell better at a high price than at a low price.

A price-leader approach is a pricing approach most often used in supermarkets to attract consumers by giving them special low prices on a few items.

If a product has an inelastic demand and the manufacturer raises its price,

Both the Federal Trade Commission Act and the Wheeler-Lea Act prohibit

Organizational goals have little to do with pricing decisions.

Comparison of various prices and various breakeven points will tell the marketer exactly what price to charge.

Demand is best determined by a top management committee.

Changes in buyers' attitudes, other components of the marketing mix, and uncontrollable environmental factors can influence demand.

Seasonal discounts provide price incentives to customers during peak selling seasons.

Suppose that the frozen foods division of Swanson purchases food trays and boxes from the packaging division. The form of pricing used to charge the frozen foods division is called

Random discounting means discounting various products on a systematic basis.

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

Cost-based pricing strategies result in a percentage being added to the cost of the product.

Customer-Driven Strategic Marketing

Planning, Implementing, and Evaluating Marketing Strategies

The Marketing Environment, Social Responsibility, and Ethics

Marketing Research and Information Systems

Target Market Segmentation and Evaluation

Consumer Buying Behavior

Business Markets and Buying Behavior

Reaching Global Markets

Digital Marketing and Social Networking

Product, Branding, and Packing Concepts

Developing and Managing Goods and Services

Marketing Channels and Supply-Chain Management

Retailing, Direct Marketing, and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Filters

Exam 12: Pricing Concepts and Management

Which of the following is not a discount provided to business customers?

A pricing strategy is a course of action designed to achieve pricing and marketing objectives.

The local florist advertises a discount on arrangements during the month of April because the anniversary of the store's opening is in April. This is an example of special-event pricing.

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

A retailer of Real Dry deodorant prices it at $2.00; it costs the retailer $1.40. What is the approximate markup as a percentage of selling price?

The idea behind prestige demand is that many prestige products seem to sell better at a high price than at a low price.

A price-leader approach is a pricing approach most often used in supermarkets to attract consumers by giving them special low prices on a few items.

If a product has an inelastic demand and the manufacturer raises its price,

Both the Federal Trade Commission Act and the Wheeler-Lea Act prohibit

Organizational goals have little to do with pricing decisions.

Comparison of various prices and various breakeven points will tell the marketer exactly what price to charge.

Demand is best determined by a top management committee.

Changes in buyers' attitudes, other components of the marketing mix, and uncontrollable environmental factors can influence demand.

Seasonal discounts provide price incentives to customers during peak selling seasons.

Suppose that the frozen foods division of Swanson purchases food trays and boxes from the packaging division. The form of pricing used to charge the frozen foods division is called

Random discounting means discounting various products on a systematic basis.

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

Cost-based pricing strategies result in a percentage being added to the cost of the product.

Customer-Driven Strategic Marketing

Planning, Implementing, and Evaluating Marketing Strategies

The Marketing Environment, Social Responsibility, and Ethics

Marketing Research and Information Systems

Target Market Segmentation and Evaluation

Consumer Buying Behavior

Business Markets and Buying Behavior

Reaching Global Markets

Digital Marketing and Social Networking

Product, Branding, and Packing Concepts

Developing and Managing Goods and Services

Marketing Channels and Supply-Chain Management

Retailing, Direct Marketing, and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Filters