Question 1

What kind of pricing objective did LivingSocial have in selling something worth $20 for $10?

Accepted Answer

A) maximum profit 
B) a satisfactory profit 
C) a targeted return on investment 
D) market share 
E) promotional pricing 
A) maximum profit 
B) a satisfactory profit 
C) a targeted return on investment 
D) market share 
E) promotional pricing

Question 2

For a nail salon,the costs associated with the purchase of nail polish and other products like nail polish remover,sterilized equipment,laundry service for the towels,and the beverages given to customers,are all examples of _____ costs.

Accepted Answer

A) marginal 
B) variable 
C) fixed 
D) promotional 
E) liquidity 
A) marginal 
B) variable 
C) fixed 
D) promotional 
E) liquidity

Question 3

Let's say that Amazon ultimately made a profit--not from the sale of the $20 cards-but from sales of books,CDs,and the like that cost well over $20 a unit.What kind of elasticity would that demonstrate?

Accepted Answer

A) inelastic demand 
B) unitary demand. 
C) inelastic demand, 
D) elastic demand,. 
E) none of the above 
A) inelastic demand 
B) unitary demand. 
C) inelastic demand, 
D) elastic demand,. 
E) none of the above

Question 4

What is the difference between fixed and variable costs? Give examples of each type of cost.

Accepted Answer

FIXED COSTS are those expenses of the fi

Question 5

American Girl Doll
The American Girl catalog began as a concept to introduce today's girls to those who lived in the past.Each historically accurate doll is carefully crafted and dressed and has books to describe her life.For example,Kristen is an 1854 pioneer girl who is growing up in Minnesota.Her story begins with her long sea voyage from Sweden.The basic doll,dressed in a calico dress and striped apron plus the hardcover story of how she got to Minnesota,costs $90.00.Six more hardback books of Kristen's life are available for $74.95.Kristen's nightgown costs $20.00,and a matching one for the doll owner is an additional $38.00.Buy both together and the price is only $50.00.A hand-painted wooden bed and trunk for Kristen are available for $213.00.Shipping costs vary with the price of the merchandise ordered.
-Refer to American Girl Doll.You can buy a doll at Walmart for $5.99.The high price of the American Girl doll is used to promote a high-quality image.American Girl uses a _____ pricing strategy.

Accepted Answer

A) markup 
B) demand-based 
C) prestige 
D) penetration 
E) supply-derived 
A) markup 
B) demand-based 
C) prestige 
D) penetration 
E) supply-derived

Question 6

One way a firm can gain pricing power is to:

Accepted Answer

A) produce something radically new and better than the competition. 
B) lower prices at least 5% below the nearest competitor. 
C) eliminate all poor producing products from manufacture and heavily promote the products that are left. 
D) join forces with a competitor to corner the market on a product. 
E) All of these strategies will help a firm gain pricing power. 
A) produce something radically new and better than the competition. 
B) lower prices at least 5% below the nearest competitor. 
C) eliminate all poor producing products from manufacture and heavily promote the products that are left. 
D) join forces with a competitor to corner the market on a product. 
E) All of these strategies will help a firm gain pricing power.

Question 7

Why are marketing managers finding it more difficult to set prices in today's environment?

Accepted Answer

A) Inflationary and recessionary periods have made customers less price sensitive. 
B) Fewer dealer and generic brands are available because the competition has been eliminated. 
C) The high rate of new-product introductions has led to careful re-evaluation by consumers. 
D) Marketing managers are finding it difficult to compare prices between suppliers. 
E) Buyers are less informed and are less price-sensitive. 
A) Inflationary and recessionary periods have made customers less price sensitive. 
B) Fewer dealer and generic brands are available because the competition has been eliminated. 
C) The high rate of new-product introductions has led to careful re-evaluation by consumers. 
D) Marketing managers are finding it difficult to compare prices between suppliers. 
E) Buyers are less informed and are less price-sensitive.

Question 8

The owner of specialty kitchen retail store wants to determine what price she should put on a set of mixing bowls.They cost her $7.She desires a markup of 30 percent based on selling price.Which of the following is closest to the price she should charge her customers?

Accepted Answer

A) $19 
B) $12 
C) $15 
D) $10 
E) $18 
A) $19 
B) $12 
C) $15 
D) $10 
E) $18

Question 9

Total variable costs divided by quantity of output equals:

Accepted Answer

A) average total cost 
B) mean intermittent cost 
C) fixed cost 
D) marginal cost 
E) average variable cost 
A) average total cost 
B) mean intermittent cost 
C) fixed cost 
D) marginal cost 
E) average variable cost

Question 10

Adequate distribution for a new product is often obtained by reducing the size of the profit margin for its resellers.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following statements about yield management systems (YMS)is true?

Accepted Answer

A) The first use of YMS was in the U.S.car industry as it looked for ways to compete with imports. 
B) YMS eliminate the problem of simultaneous production and consumption from services. 
C) YMS cannot be used by any other businesses but services. 
D) YMS are complex pricing systems used to set equilibrium pricing points. 
E) YMS are mathematically complex systems to make use of underutilized capacity and reduce the cost of perishability. 
A) The first use of YMS was in the U.S.car industry as it looked for ways to compete with imports. 
B) YMS eliminate the problem of simultaneous production and consumption from services. 
C) YMS cannot be used by any other businesses but services. 
D) YMS are complex pricing systems used to set equilibrium pricing points. 
E) YMS are mathematically complex systems to make use of underutilized capacity and reduce the cost of perishability.

Question 12

What are the problems associated with the use of a cost-based pricing strategy? What contribution does cost make to the setting of prices?

Accepted Answer

Setting prices based solely on costs ign

Question 13

When Insight Research Associates quotes a marketing research project,management will first estimate the cost to conduct the research and produce and deliver the final client report.The next step in determining the price is to add 30 percent to that cost estimate.This becomes the price estimate given to the potential research client.This suggests that Insight Research Associates uses a(n)_____ pricing objective.

Accepted Answer

A) profit-oriented 
B) market share maximization 
C) status quo 
D) sales maximization 
E) supply-demand equalization 
A) profit-oriented 
B) market share maximization 
C) status quo 
D) sales maximization 
E) supply-demand equalization

Question 14

Marketing managers who attempt to raise the quality image of their product by selling it at high prices are following a(n)_____ strategy.

Accepted Answer

A) profit maximization 
B) market share 
C) maintained markup pricing 
D) prestige pricing 
E) investment asset 
A) profit maximization 
B) market share 
C) maintained markup pricing 
D) prestige pricing 
E) investment asset

Question 15

What happens when demand is elastic?

Accepted Answer

A) As price goes up,revenue goes down. 
B) As price goes down,revenue goes down. 
C) As price goes up,revenue goes up. 
D) As price goes up,revenue does not change. 
E) As price goes down,revenue does not change. 
A) As price goes up,revenue goes down. 
B) As price goes down,revenue goes down. 
C) As price goes up,revenue goes up. 
D) As price goes up,revenue does not change. 
E) As price goes down,revenue does not change.

Question 16

Research on 1,500 car purchases found that the Internet lowers prices for two distinct reasons.Identify and discuss each.

Accepted Answer

First,the Internet informs consumers.The

Question 17

When the local Shell station raises or lowers its prices on its gasoline,the Marathon station across the street makes the same changes in its pricing.This is an example of _____ pricing.

Accepted Answer

A) status quo 
B) target return 
C) market share 
D) predatory 
E) cost-plus 
A) status quo 
B) target return 
C) market share 
D) predatory 
E) cost-plus

Question 18

The difference between the retailer's cost and the selling price is the:

Accepted Answer

A) gross margin. 
B) markup percentage. 
C) profit. 
D) keystone. 
E) breakeven profit. 
A) gross margin. 
B) markup percentage. 
C) profit. 
D) keystone. 
E) breakeven profit.

Question 19

If a product has high pricing power,this would indicate a situation of:

Accepted Answer

A) unitary demand. 
B) inelastic demand. 
C) elastic demand. 
D) constant demand. 
E) revenue maximization. 
A) unitary demand. 
B) inelastic demand. 
C) elastic demand. 
D) constant demand. 
E) revenue maximization.

Question 20

If demand for milk is inelastic,consumers will not change their purchasing habits greatly when the price of milk changes.

Accepted Answer

A) True 
 B)False

What kind of pricing objective did LivingSocial have in selling something worth $20 for $10?

For a nail salon,the costs associated with the purchase of nail polish and other products like nail polish remover,sterilized equipment,laundry service for the towels,and the beverages given to customers,are all examples of _____ costs.

Let's say that Amazon ultimately made a profit--not from the sale of the $20 cards-but from sales of books,CDs,and the like that cost well over $20 a unit.What kind of elasticity would that demonstrate?

What is the difference between fixed and variable costs? Give examples of each type of cost.

One way a firm can gain pricing power is to:

Why are marketing managers finding it more difficult to set prices in today's environment?

The owner of specialty kitchen retail store wants to determine what price she should put on a set of mixing bowls.They cost her $7.She desires a markup of 30 percent based on selling price.Which of the following is closest to the price she should charge her customers?

Total variable costs divided by quantity of output equals:

Adequate distribution for a new product is often obtained by reducing the size of the profit margin for its resellers.

Which of the following statements about yield management systems (YMS)is true?

What are the problems associated with the use of a cost-based pricing strategy? What contribution does cost make to the setting of prices?

Marketing managers who attempt to raise the quality image of their product by selling it at high prices are following a(n)_____ strategy.

What happens when demand is elastic?

Research on 1,500 car purchases found that the Internet lowers prices for two distinct reasons.Identify and discuss each.

When the local Shell station raises or lowers its prices on its gasoline,the Marathon station across the street makes the same changes in its pricing.This is an example of _____ pricing.

The difference between the retailer's cost and the selling price is the:

If a product has high pricing power,this would indicate a situation of:

If demand for milk is inelastic,consumers will not change their purchasing habits greatly when the price of milk changes.

An Overview of Marketing

Strategic Planning for Competitive Advantage

Ethics and Social Responsibility

The Marketing Environment

Developing a Global Vision

Consumer Decision Making

Business Marketing

Segmenting and Targeting Markets

Decision Support Systems and Marketing Research

Product Concepts

Developing and Managing Products

Services and Nonprofit Organization Marketing

Marketing Channels

Supply Chain Management

Retailing

Integrated Marketing Communications

Advertising and Public Relations

Sales Promotion and Personal Selling

Setting the Right Price

Customer Relationship Management Crm

Social Media and Marketing

Filters

Exam 19: Pricing Concepts

What kind of pricing objective did LivingSocial have in selling something worth $20 for $10?

For a nail salon,the costs associated with the purchase of nail polish and other products like nail polish remover,sterilized equipment,laundry service for the towels,and the beverages given to customers,are all examples of _____ costs.

Let's say that Amazon ultimately made a profit--not from the sale of the $20 cards-but from sales of books,CDs,and the like that cost well over $20 a unit.What kind of elasticity would that demonstrate?

What is the difference between fixed and variable costs? Give examples of each type of cost.

One way a firm can gain pricing power is to:

Why are marketing managers finding it more difficult to set prices in today's environment?

The owner of specialty kitchen retail store wants to determine what price she should put on a set of mixing bowls.They cost her $7.She desires a markup of 30 percent based on selling price.Which of the following is closest to the price she should charge her customers?

Total variable costs divided by quantity of output equals:

Adequate distribution for a new product is often obtained by reducing the size of the profit margin for its resellers.

Which of the following statements about yield management systems (YMS)is true?

What are the problems associated with the use of a cost-based pricing strategy? What contribution does cost make to the setting of prices?

Marketing managers who attempt to raise the quality image of their product by selling it at high prices are following a(n)_____ strategy.

What happens when demand is elastic?

Research on 1,500 car purchases found that the Internet lowers prices for two distinct reasons.Identify and discuss each.

When the local Shell station raises or lowers its prices on its gasoline,the Marathon station across the street makes the same changes in its pricing.This is an example of _____ pricing.

The difference between the retailer's cost and the selling price is the:

If a product has high pricing power,this would indicate a situation of:

If demand for milk is inelastic,consumers will not change their purchasing habits greatly when the price of milk changes.

An Overview of Marketing

Strategic Planning for Competitive Advantage

Ethics and Social Responsibility

The Marketing Environment

Developing a Global Vision

Consumer Decision Making

Business Marketing

Segmenting and Targeting Markets

Decision Support Systems and Marketing Research

Product Concepts

Developing and Managing Products

Services and Nonprofit Organization Marketing

Marketing Channels

Supply Chain Management

Retailing

Integrated Marketing Communications

Advertising and Public Relations

Sales Promotion and Personal Selling

Setting the Right Price

Customer Relationship Management Crm

Social Media and Marketing

Filters