Question 1

Explain the significance of market share as a sales-oriented pricing objective.

Accepted Answer

Answers will vary. Market share is a com

Question 2

Yield management systems encourage airline companies to ignore the importance of demand and decide to price their products largely or solely on the basis of costs.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following statements is true of yield management systems?

Accepted Answer

A) They determine the availability of product substitutes in industries that are experiencing rapid change. 
B) They use software that employs techniques such as discounting early purchases and limiting early sales at these discounted prices. 
C) They predict necessary service levels required to achieve revenue goals. 
D) They determine whether it is financially more feasible to buy a new product or to repair a broken one. 
A) They determine the availability of product substitutes in industries that are experiencing rapid change. 
B) They use software that employs techniques such as discounting early purchases and limiting early sales at these discounted prices. 
C) They predict necessary service levels required to achieve revenue goals. 
D) They determine whether it is financially more feasible to buy a new product or to repair a broken one.

Question 4

Profit-oriented pricing objectives include _____.

Accepted Answer

A) target return on investment 
B) target market share 
C) meeting competitors' prices 
D) status quo pricing 
A) target return on investment 
B) target market share 
C) meeting competitors' prices 
D) status quo pricing

Question 5

To increase the popularity of its new range of smartphones, GizmoPro Inc., a mobile phone manufacturer, offered several accessories for free to customers who bought the smartphones. However, the management of GizmoPro Inc. soon found this an unsustainable practice. The company then decided to offer discounts on the accessories instead of giving them for free. These actions of the management of GizmoPro Inc. are aimed at _____.

Accepted Answer

A) market share pricing 
B) profit maximization 
C) demand orientation 
D) sales maximization 
A) market share pricing 
B) profit maximization 
C) demand orientation 
D) sales maximization

Question 6

_____ is a pricing policy whereby a firm charges a relatively low price for a product when it is first rolled out as a way to reach the mass market.

Accepted Answer

A) Penetration pricing 
B) Price skimming 
C) Price discrimination 
D) Status quo pricing 
A) Penetration pricing 
B) Price skimming 
C) Price discrimination 
D) Status quo pricing

Question 7

Which of the following statements is true of shopping bots?

Accepted Answer

A) The broad-based type of shopping bot searches for prices for only one type of product. 
B) They create opportunities for prestige pricing. 
C) They theoretically give pricing power to a consumer. 
D) The niche-oriented shopping bot searches a wide range of product categories. 
A) The broad-based type of shopping bot searches for prices for only one type of product. 
B) They create opportunities for prestige pricing. 
C) They theoretically give pricing power to a consumer. 
D) The niche-oriented shopping bot searches a wide range of product categories.

Question 8

Which of the following statements is true of unfair trade practice acts?

Accepted Answer

A) They prohibit any firm from selling to two or more different buyers. 
B) Unfair trade practice laws prevent oligopoly leaders from joining together and fixing prices at the highest rates that a market will allow. 
C) They establish penalties for companies that engage in predatory pricing. 
D) State enforcement of unfair trade practice laws has been lax partly because low prices benefit local consumers. 
A) They prohibit any firm from selling to two or more different buyers. 
B) Unfair trade practice laws prevent oligopoly leaders from joining together and fixing prices at the highest rates that a market will allow. 
C) They establish penalties for companies that engage in predatory pricing. 
D) State enforcement of unfair trade practice laws has been lax partly because low prices benefit local consumers.

Question 9

Which of the following statements is true of simple break-even analysis?

Accepted Answer

A) It does not consider the selling price of a product. 
B) It does not give weightage to the cost of labor. 
C) It is applicable only when the demand for a product is elastic. 
D) It ignores the demand for a product. 
A) It does not consider the selling price of a product. 
B) It does not give weightage to the cost of labor. 
C) It is applicable only when the demand for a product is elastic. 
D) It ignores the demand for a product.

Question 10

Unlike a firm that strives for market share, a firm with the objective of maximizing sales:

Accepted Answer

A) possesses adequate funds and faces an optimistic future. 
B) ignores profits, competition, and the marketing environment as long as sales are rising. 
C) benefits from maximization of cash if it is adopted as a long-run objective. 
D) seeks to maintain existing prices or to meet the competition's prices. 
A) possesses adequate funds and faces an optimistic future. 
B) ignores profits, competition, and the marketing environment as long as sales are rising. 
C) benefits from maximization of cash if it is adopted as a long-run objective. 
D) seeks to maintain existing prices or to meet the competition's prices.

Question 11

_____ is the quantity of a product that will be offered to the market by a supplier at various prices for a specified period.

Accepted Answer

A) Demand 
B) Supply 
C) Market share 
D) Product share 
A) Demand 
B) Supply 
C) Market share 
D) Product share

Question 12

Which of the following is a limitation of break-even analysis?

Accepted Answer

A) It does not give an estimate of how much profit can be earned once the break-even point is obtained. 
B) It does not give weightage to the cost of labor that is incurred during production. 
C) Sometimes it cannot predict the effect of changes in sales price. 
D) Sometimes it is hard to know whether a cost is fixed or variable. 
A) It does not give an estimate of how much profit can be earned once the break-even point is obtained. 
B) It does not give weightage to the cost of labor that is incurred during production. 
C) Sometimes it cannot predict the effect of changes in sales price. 
D) Sometimes it is hard to know whether a cost is fixed or variable.

Question 13

Extranets enable buyers to quickly and easily compare products and prices, putting them in a better bargaining position.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following statements is true of geographic pricing?

Accepted Answer

A) Freight absorption pricing is a tactic that requires a buyer to absorb the freight costs from the shipping point. 
B) Uniform delivered pricing divides the United States into segments or zones and charges a flat freight rate to all customers in a given zone. 
C) Postage stamp pricing is adopted when the marketing manager wants total costs to be equal for all purchasers of identical products. 
D) With basing-point pricing, a seller designates a location as a basing point so that all buyers are not charged the freight cost from that point. 
A) Freight absorption pricing is a tactic that requires a buyer to absorb the freight costs from the shipping point. 
B) Uniform delivered pricing divides the United States into segments or zones and charges a flat freight rate to all customers in a given zone. 
C) Postage stamp pricing is adopted when the marketing manager wants total costs to be equal for all purchasers of identical products. 
D) With basing-point pricing, a seller designates a location as a basing point so that all buyers are not charged the freight cost from that point.

Question 15

Discuss the role of price in the evaluation of product alternatives.

Accepted Answer

Answers will vary. Price is that which i

Question 16

The managers at Click-to-Door, an e-commerce website, closely monitor its rival online retailers to analyze how consumers respond to changes in the prices of certain products. They use the results of this analysis to constantly change the prices on their website to maximize sales and profits. In this case, which of the following pricing strategies does Click-to-Door follow?

Accepted Answer

A) Comparative pricing 
B) Dynamic pricing 
C) Capacitive pricing 
D) Dependent pricing 
A) Comparative pricing 
B) Dynamic pricing 
C) Capacitive pricing 
D) Dependent pricing

Question 17

Betty, a teenager, starts a business selling cupcakes to coffee shops and restaurants. She strives to increase either the market share in terms of the revenue generated. This illustrates the _____ objective.

Accepted Answer

A) status quo pricing 
B) profit-oriented pricing 
C) bait pricing 
D) sales-oriented pricing 
A) status quo pricing 
B) profit-oriented pricing 
C) bait pricing 
D) sales-oriented pricing

Question 18

To prove predatory pricing, the predator must show that it explicitly tried to ruin a competitor and that the predatory price was below its average variable cost.

Accepted Answer

A) True 
 B)False

Question 19

Explain with examples how price plays a role in promotion strategies for products.

Accepted Answer

Answers will vary. Price is often used a

Question 20

A cost that changes with the level of output is called a(n) _____.

Accepted Answer

A) liquid cost 
B) variable cost 
C) independent cost 
D) indirect cost 
A) liquid cost 
B) variable cost 
C) independent cost 
D) indirect cost

Explain the significance of market share as a sales-oriented pricing objective.

Yield management systems encourage airline companies to ignore the importance of demand and decide to price their products largely or solely on the basis of costs.

Which of the following statements is true of yield management systems?

Profit-oriented pricing objectives include _____.

_____ is a pricing policy whereby a firm charges a relatively low price for a product when it is first rolled out as a way to reach the mass market.

Which of the following statements is true of shopping bots?

Which of the following statements is true of unfair trade practice acts?

Which of the following statements is true of simple break-even analysis?

Unlike a firm that strives for market share, a firm with the objective of maximizing sales:

_____ is the quantity of a product that will be offered to the market by a supplier at various prices for a specified period.

Which of the following is a limitation of break-even analysis?

Extranets enable buyers to quickly and easily compare products and prices, putting them in a better bargaining position.

Which of the following statements is true of geographic pricing?

Discuss the role of price in the evaluation of product alternatives.

Betty, a teenager, starts a business selling cupcakes to coffee shops and restaurants. She strives to increase either the market share in terms of the revenue generated. This illustrates the _____ objective.

To prove predatory pricing, the predator must show that it explicitly tried to ruin a competitor and that the predatory price was below its average variable cost.

Explain with examples how price plays a role in promotion strategies for products.

A cost that changes with the level of output is called a(n) _____.

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

Marketing Research

Product Concepts

Developing and Managing Products

Services and Nonprofit Organization Marketing

Supply Chain Management and Marketing Channels

Retailing

Marketing Communications

Advertising, Public Relations, and Sales Promotion

Personal Selling and Sales Management

Social Media and Marketing

Filters

Exam 19: Pricing Concepts

Explain the significance of market share as a sales-oriented pricing objective.

Yield management systems encourage airline companies to ignore the importance of demand and decide to price their products largely or solely on the basis of costs.

Which of the following statements is true of yield management systems?

Profit-oriented pricing objectives include _____.

_____ is a pricing policy whereby a firm charges a relatively low price for a product when it is first rolled out as a way to reach the mass market.

Which of the following statements is true of shopping bots?

Which of the following statements is true of unfair trade practice acts?

Which of the following statements is true of simple break-even analysis?

Unlike a firm that strives for market share, a firm with the objective of maximizing sales:

_____ is the quantity of a product that will be offered to the market by a supplier at various prices for a specified period.

Which of the following is a limitation of break-even analysis?

Extranets enable buyers to quickly and easily compare products and prices, putting them in a better bargaining position.

Which of the following statements is true of geographic pricing?

Discuss the role of price in the evaluation of product alternatives.

Betty, a teenager, starts a business selling cupcakes to coffee shops and restaurants. She strives to increase either the market share in terms of the revenue generated. This illustrates the _____ objective.

To prove predatory pricing, the predator must show that it explicitly tried to ruin a competitor and that the predatory price was below its average variable cost.

Explain with examples how price plays a role in promotion strategies for products.

A cost that changes with the level of output is called a(n) _____.

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

Marketing Research

Product Concepts

Developing and Managing Products

Services and Nonprofit Organization Marketing

Supply Chain Management and Marketing Channels

Retailing

Marketing Communications

Advertising, Public Relations, and Sales Promotion

Personal Selling and Sales Management

Social Media and Marketing

Filters