Question 1

If a company's pricing objective is to meet the competition or to maintain existing prices,it is using _____ pricing.

Accepted Answer

A) head-on 
B) target return on investment 
C) status quo 
D) market share 
E) demand-oriented 
A) head-on 
B) target return on investment 
C) status quo 
D) market share 
E) demand-oriented

Question 2

One of the most stressful and pressure-filled tasks of the marketing manager is attempting to set the right price.Specify three aspects of the current pricing environment in consumer markets that have contributed to the difficulty in setting correct prices.

Accepted Answer

Five factors in the consumer products ma

Question 3

Yield management systems are used to:

Accepted Answer

A) determine the availability of product substitutes in complex industries that are experiencing rapid change 
B) profitably fill unused capacity 
C) predict necessary service levels to achieve revenue goals 
D) determine whether it is financially more feasible to buy a new product or repair a broken one 
E) create elastic demand for low-involvement products 
A) determine the availability of product substitutes in complex industries that are experiencing rapid change 
B) profitably fill unused capacity 
C) predict necessary service levels to achieve revenue goals 
D) determine whether it is financially more feasible to buy a new product or repair a broken one 
E) create elastic demand for low-involvement products

Question 4

Smelly Fruit
At first glance,there is little to like about the durian.The durian is a fruit popular in Thailand that is spiky outside and stinky on the inside.When confronted with the durian for the first time,the Wall Street Journal recently reported that westerners often describe its distinctive sulphurous smell with words like stinky socks and manure.However,the durian is so popular in Thailand that one variety of the durian fruit,called the Kan Yao,has been selling for as high as $200.Even at that price,supply of the Kan Yao cannot keep up with demand.There are approximately 30 varieties of the durian grown in Thailand,with the most plentiful selling in the $15 range.The yellow flesh of the durian,the part you eat,has very powerful smell but possesses a sweet,nutty taste that Thais cannot seem to get enough of at any price.
-Refer to Smelly Fruit.Suppose that you have decided to buy land in Thailand and become a durian producer.You see that the customary price for a Kan Yao is $200,so that is the price you decide to charge for your durian crop.This suggests you are using a _____ approach to setting your price.

Accepted Answer

A) profit maximization 
B) market share 
C) return on investment (ROI) 
D) sales maximization 
E) status quo 
A) profit maximization 
B) market share 
C) return on investment (ROI) 
D) sales maximization 
E) status quo

Question 5

A company using market share pricing has a _____ pricing objective.

Accepted Answer

A) profit-oriented 
B) sales-oriented 
C) demand-oriented 
D) supply-oriented 
E) status quo 
A) profit-oriented 
B) sales-oriented 
C) demand-oriented 
D) supply-oriented 
E) status quo

Question 6

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.What is the revenue to American Girl if it sells 20 basic Kristen doll and books?

Accepted Answer

A) $90.00 
B) $100.95 
C) $427.95 
D) $1,800.00 
E) $3,600.00 
A) $90.00 
B) $100.95 
C) $427.95 
D) $1,800.00 
E) $3,600.00

Question 7

Keystoning is:

Accepted Answer

A) the practice of marking up prices by 100 percent. 
B) a method used for determining the point of elasticity. 
C) a plan for reducing marginal costs. 
D) the practice of maintaining variable costs at one-half of total fixed costs. 
E) a method of changing consumers' perceptions about price. 
A) the practice of marking up prices by 100 percent. 
B) a method used for determining the point of elasticity. 
C) a plan for reducing marginal costs. 
D) the practice of maintaining variable costs at one-half of total fixed costs. 
E) a method of changing consumers' perceptions about price.

Question 8

Profit maximization occurs when:

Accepted Answer

A) total costs equals average fixed revenue. 
B) average variable costs are larger than average total costs. 
C) total costs equal total variable costs. 
D) marginal variable costs equal average revenues. 
E) marginal revenue equals marginal cost. 
A) total costs equals average fixed revenue. 
B) average variable costs are larger than average total costs. 
C) total costs equal total variable costs. 
D) marginal variable costs equal average revenues. 
E) marginal revenue equals marginal cost.

Question 9

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.Based on the information in the narrative,which of the following factors is most likely to affect the elasticity of demand for the doll?

Accepted Answer

A) The absence of substitutes 
B) The existence of complementary products 
C) The price relative to purchasing power 
D) Product durability 
E) A variety of alternative uses for the product 
A) The absence of substitutes 
B) The existence of complementary products 
C) The price relative to purchasing power 
D) Product durability 
E) A variety of alternative uses for the product

Question 10

Price is best described as:

Accepted Answer

A) that which is given up in exchange to acquire a good or service 
B) money exchanged for a good or service 
C) the psychological results of purchasing 
D) the cost in dollars for a good or service as set by the producer 
E) the value of a barter good in an exchange 
A) that which is given up in exchange to acquire a good or service 
B) money exchanged for a good or service 
C) the psychological results of purchasing 
D) the cost in dollars for a good or service as set by the producer 
E) the value of a barter good in an exchange

Question 11

Target return on investment is the most common profit objective used by firms.

Accepted Answer

A) True 
 B)False

Question 12

Smelly Fruit
At first glance,there is little to like about the durian.The durian is a fruit popular in Thailand that is spiky outside and stinky on the inside.When confronted with the durian for the first time,the Wall Street Journal recently reported that westerners often describe its distinctive sulphurous smell with words like stinky socks and manure.However,the durian is so popular in Thailand that one variety of the durian fruit,called the Kan Yao,has been selling for as high as $200.Even at that price,supply of the Kan Yao cannot keep up with demand.There are approximately 30 varieties of the durian grown in Thailand,with the most plentiful selling in the $15 range.The yellow flesh of the durian,the part you eat,has very powerful smell but possesses a sweet,nutty taste that Thais cannot seem to get enough of at any price.
-Refer to Smelly Fruit.Suppose that a Thai farmer sells ten Kan Yao durians in the marketplace at the going rate of $200 each.If it cost a Thai farmer $125 to produce and market the Kan Yao durian that she has sold,the difference between these two numbers ($75),times the number sold (ten),represents the farmer's:

Accepted Answer

A) ROI 
B) revenue 
C) profit 
D) returns 
E) COGS 
A) ROI 
B) revenue 
C) profit 
D) returns 
E) COGS

Question 13

At the end of the summer,the Bloomin' Garden Center reduced the price on all of its plants,fertilizer,and potting soil by 50 percent in order to liquidate this inventory.What type of pricing strategy is being used in this example?

Accepted Answer

A) Supply oriented 
B) Sales maximization 
C) Target return on investment 
D) Satisfactory profit 
E) Profit maximization 
A) Supply oriented 
B) Sales maximization 
C) Target return on investment 
D) Satisfactory profit 
E) Profit maximization

Question 14

Tesla Motors
"Going green" doesn't have to be boring.The Tesla Roadster Sport is an electric car that goes from 0 to 60 in four seconds and drives more like a race car than an environmentally friendly ride.But that level of performance will set you back $128,500.As of 2009,Silicon Valley-based Tesla Motors,Inc.was the only company offering highway-compatible electric cars.Most Roadster Sport buyers are car enthusiasts and are buying them for the "fun toy" aspect of having an electric car rather than for environmental reasons.
-Refer to Tesla Motors.If Tesla had assets of $5 million and net profits after taxes of $550,000,what is Tesla's return on investment?

Accepted Answer

A) 1 percent 
B) 9 percent 
C) 11 percent 
D) $14,135 
E) $4,450,000 
A) 1 percent 
B) 9 percent 
C) 11 percent 
D) $14,135 
E) $4,450,000

Question 15

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.American Girl is the primary seller of historically accurate dolls with accompanying books in a market where there is very little competition.It has no cash flow problems and is not interested in maximizing its sales.From this information,you should know American Girl has _____ pricing objectives.

Accepted Answer

A) status quo 
B) psychological 
C) profit-oriented 
D) sales-oriented 
E) supply-derived 
A) status quo 
B) psychological 
C) profit-oriented 
D) sales-oriented 
E) supply-derived

Question 16

Yield management systems can only be used by service industries.

Accepted Answer

A) True 
 B)False

Question 17

Your Memory Lane produces custom-made art prints that include graphics and icons to celebrate life's special moments.For example,on his wedding anniversary,David had an art print produced that celebrated highlights of his ten years with his wife,Kathy.Suppose that Your Memory Lane sells the custom artwork for $500.It estimates its average variable costs to be $200 per unit produced.It figures its fixed costs to be $900,000 per year.How many prints does it have to sell to break even?

Accepted Answer

A) 2,000 prints 
B) 1,200 prints 
C) 3,000 prints 
D) 2,500 prints 
E) 6,000 prints 
A) 2,000 prints 
B) 1,200 prints 
C) 3,000 prints 
D) 2,500 prints 
E) 6,000 prints

Question 18

The marketing event that took place between LivingSocial and Groupon is all of the following except __________.

Accepted Answer

A) taking market share from the other 
B) competition 
C) a price war 
D) a promotional strategy 
E) preservation of market share 
A) taking market share from the other 
B) competition 
C) a price war 
D) a promotional strategy 
E) preservation of market share

Question 19

When the price of a product is set at a level where demand and supply are the same,_____ has been achieved.

Accepted Answer

A) equilibrium 
B) stability 
C) leverage 
D) symmetry 
E) status quo 
A) equilibrium 
B) stability 
C) leverage 
D) symmetry 
E) status quo

Question 20

As a short-term pricing objective,_____ can be effectively used on a temporary basis to sell off excessive inventory.

Accepted Answer

A) profit maximization 
B) profit-oriented pricing 
C) status quo pricing 
D) sales maximization 
E) market share pricing 
A) profit maximization 
B) profit-oriented pricing 
C) status quo pricing 
D) sales maximization 
E) market share pricing

If a company's pricing objective is to meet the competition or to maintain existing prices,it is using _____ pricing.

One of the most stressful and pressure-filled tasks of the marketing manager is attempting to set the right price.Specify three aspects of the current pricing environment in consumer markets that have contributed to the difficulty in setting correct prices.

Yield management systems are used to:

A company using market share pricing has a _____ pricing objective.

Keystoning is:

Profit maximization occurs when:

Price is best described as:

Target return on investment is the most common profit objective used by firms.

At the end of the summer,the Bloomin' Garden Center reduced the price on all of its plants,fertilizer,and potting soil by 50 percent in order to liquidate this inventory.What type of pricing strategy is being used in this example?

Yield management systems can only be used by service industries.

The marketing event that took place between LivingSocial and Groupon is all of the following except __________.

When the price of a product is set at a level where demand and supply are the same,_____ has been achieved.

As a short-term pricing objective,_____ can be effectively used on a temporary basis to sell off excessive inventory.

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

If a company's pricing objective is to meet the competition or to maintain existing prices,it is using _____ pricing.

One of the most stressful and pressure-filled tasks of the marketing manager is attempting to set the right price.Specify three aspects of the current pricing environment in consumer markets that have contributed to the difficulty in setting correct prices.

Yield management systems are used to:

A company using market share pricing has a _____ pricing objective.

Keystoning is:

Profit maximization occurs when:

Price is best described as:

Target return on investment is the most common profit objective used by firms.

At the end of the summer,the Bloomin' Garden Center reduced the price on all of its plants,fertilizer,and potting soil by 50 percent in order to liquidate this inventory.What type of pricing strategy is being used in this example?

Yield management systems can only be used by service industries.

The marketing event that took place between LivingSocial and Groupon is all of the following except __________.

When the price of a product is set at a level where demand and supply are the same,_____ has been achieved.

As a short-term pricing objective,_____ can be effectively used on a temporary basis to sell off excessive inventory.

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