Exam 21: Setting Prices

Executives in Japan decided to price Lexus luxury cars in the United States at $55,000 while pricing them at $66,000 in their own country.This is an example of

Kohls pays $16.50 for a six-ounce bottle of cologne and sells it for $25.95.Its markup as a percentage of cost is approximately ____ percent for this product.

Bundle pricing may be perceived to be of value by customers because

The Office Place is an office supplies company who has just adjusted its price levels so that it can increase its sales volume to match its expenses.The Office Place is most likely employing a(n)____ objective.

Which of the following pricing strategies often results in a retailer losing money on the product?

Describe the six steps of the process that marketers can use to establish prices.

A product is a price leader when

Scenario 21.2 Use the following to answer the questions. Glenwood Pet Hospital is considering implementing a new pricing strategy for its veterinarian services.After reviewing the previous three years' revenue,Glenwood finds that most of its customers bring their pets in for the required annual vaccinations and then only if the animal is ill.Glenwood's objective is to generate more income per customer on an annual basis.The hospital has previously priced its services by charging a flat fee for the office visit,a fee for each vaccine,and a fee for each type of examination beyond the basic office visit.Most customers pay the flat office fee and a fee for a rabies vaccine.Glenwood is now considering a new plan where the pet owner would pay one fee that would cover an office visit,the required rabies vaccine,and additional vaccines that prevent heartworm,kennel-cough,and fleas.Glenwood hopes to encourage the pet owners to view their pet's health as part of a prevention program,rather than a one-time annual visit. -Refer to Scenario 21.2.Glenwood's previous pricing strategy is an example of ____ pricing,while the new strategy is an example of ____ pricing.

Scenario 21.1 Use the following to answer the questions. Suppose that Ray-Ban is considering a new line of sunglasses that would be sold in major department stores.The new line would be positioned as a more distinctive brand than the typical glasses sold through department stores,and would be priced higher than other brands in the store,but a lower price line than the current Ray-Ban lines that are sold through more selective stores.In determining the price for this sunglass line,Ray-Ban wants to gather information about all brands sold in department stores and about customers' perceptions of those brands. -Refer to Scenario 21.1.Ray-Ban's plan of gathering information about the other brands sold in department stores,including their prices,would most likely be used in a ____ basis for pricing.

The use of price skimming discourages competitors from entering a market.

Showing a product's price along with its previous price,the price of a competing brand,or the price at another retail outlet is called

Nabisco is considering two pricing objectives.The first is to sell one out of every three crackers consumed in the world,an objective based on _______;the second is to meet,but not beat,competitor's prices of cookie products,which is a _____ objective.

The objective of profit maximization is rarely operational because its achievement is difficult to measure.

A price-skimming strategy assumes that

Lexmark sells some of its color printers for about $100,but the refill cartridges cost over $30 each.Lexmark's pricing strategy would be best labeled as

Scenario 21.2 Use the following to answer the questions. Glenwood Pet Hospital is considering implementing a new pricing strategy for its veterinarian services.After reviewing the previous three years' revenue,Glenwood finds that most of its customers bring their pets in for the required annual vaccinations and then only if the animal is ill.Glenwood's objective is to generate more income per customer on an annual basis.The hospital has previously priced its services by charging a flat fee for the office visit,a fee for each vaccine,and a fee for each type of examination beyond the basic office visit.Most customers pay the flat office fee and a fee for a rabies vaccine.Glenwood is now considering a new plan where the pet owner would pay one fee that would cover an office visit,the required rabies vaccine,and additional vaccines that prevent heartworm,kennel-cough,and fleas.Glenwood hopes to encourage the pet owners to view their pet's health as part of a prevention program,rather than a one-time annual visit. -Refer to Scenario 21.2.Glenwood's closest competitor,The Hearthstone Pet Hospital,currently charges $60 for each basic office visit.If Glenwood were to price its basic office visit at $45,it would most likely be employing which of the following?

If PepsiCo sets its twelve-pack price to match the price charged by Coca-Cola,Pepsi is using which of the following pricing methods?

Maintaining a certain market share,meeting competitors' prices,maintaining a favorable image,and achieving price stability are all associated with a ____ pricing objective.

Marketers must take steps to make sure that the pricing objectives they set are consistent with the organization's ____ objectives and ____ objectives.

In some cases,prices are assigned to goods on the basis of nothing more than custom.