Exam 14: Developing Pricing Strategies and Programs

Florida hotels discount the cost of their hotel rooms during the hot summer months. On the other hand, during the winter months, the price of these rooms increases. This is an example of what type of discounts?

Cutting prices to keep customers or beat competitors often encourages customers to demand price concessions.

When a retailer puts a sign on a product that says "reduced" or a retailer points a sign on a product that says "compare to XXX at $10.00 more," the retailer is encouraging what kind of pricing psychology for its shoppers?

A price indifference band is that section of the price increase in which the consumer does not notice or does not have any effect in demand.

Which of the following is the first step in setting a pricing policy?

________ is the direct exchange of goods, with no money and no third party involved.

To maximize market share, a firm may use ________ pricing which sits on the theory that as sales volume increases, unit costs will decrease.

You are introducing a new product to the market; in fact, you are first with this new product to the marketplace. In developing your pricing strategy, it was decided that the price of the product should be at the maximum the market would bear. This is an example of what type of pricing strategy?

Executives complain that pricing is a big headache. Many companies determine their costs then add the industry's traditional margin. Your firm decides to use price as a "strategic tool" in the marketing mix. What is it that your firm needs to do to be able to use price as a "strategic tool"?

In first-degree price discrimination, the seller charges less to buyers of larger volumes.