Question 1

What are the advantages and disadvantages of using demand-based pricing?

Accepted Answer

Demand-based pricing assures a firm that it should be able to sell what it produces at the determined price because the price is based on market research findings about customer demand rather than on the seller's costs. Disadvantages include the difficulty in estimating demand accurately and that there is no assurance the price will be profitable (or even cover costs).

Question 2

Swatch surveyed the market and identified an unserved segment of watch buyers. Using these results, Swatch created a watch at a price consumers were willing to pay. The unorthodox order of this marketing mix decision is an example of ________.

Accepted Answer

A)  competition-based pricing 
B)  cost-plus pricing 
C)  target costing 
D)  value pricing 
E)  penetration pricing 
A)  competition-based pricing 
B)  cost-plus pricing 
C)  target costing 
D)  value pricing 
E)  penetration pricing C

Question 3

A business using price lining is doing which of the following?

Accepted Answer

A)  trying to avoid the use of psychological pricing, which may be negatively received by customers 
B)  trying to recover its research and development costs for a new product 
C)  attempting to achieve a large market share before any competitors can enter the marketplace 
D)  selling items in a product line at different prices 
E)  engaging in potentially unethical pricing 
A)  trying to avoid the use of psychological pricing, which may be negatively received by customers 
B)  trying to recover its research and development costs for a new product 
C)  attempting to achieve a large market share before any competitors can enter the marketplace 
D)  selling items in a product line at different prices 
E)  engaging in potentially unethical pricing D

Question 4

Describe what a demand curve is and explain how it helps marketers make decisions.

Accepted Answer

The demand curve estimates consumer dema

Question 5

Explain the pricing strategy being implemented when a retail store places the store's brand items next to the national brand items when the national brand items have a slightly higher price than the store's item. Why would a retailer do this?

Accepted Answer

The store is relying on the assimilation

Question 6

Businesses within a purely competitive market have few opportunities to raise or lower their prices.

Accepted Answer

A) True 
 B)False

Question 7

Some retailers advertise items at very low prices or even below cost just to get customers into the store. The rationale for implementing this ________ strategy is the belief that once a customer is in the store she will buy the advertised item as well as other items at regular prices.

Accepted Answer

A)  bait-and-switch 
B)  price lining 
C)  predatory pricing 
D)  loss-leader pricing 
E)  keystoning 
A)  bait-and-switch 
B)  price lining 
C)  predatory pricing 
D)  loss-leader pricing 
E)  keystoning

Question 8

Unlike other currencies, bitcoin is not controlled by a single government entity, such as the U.S. Treasury.

Accepted Answer

A) True 
 B)False

Question 9

When a beverage maker came out with a new drink and priced it at half price for a month to attract buyers, the company was using a(n) ________ strategy.

Accepted Answer

A)  penetration pricing 
B)  skimming price 
C)  everyday low price 
D)  trial pricing 
E)  promo pricing 
A)  penetration pricing 
B)  skimming price 
C)  everyday low price 
D)  trial pricing 
E)  promo pricing

Question 10

Why is price lining a good practice for retailers?

Accepted Answer

Price lining is a way to maximize profit

Question 11

Cellular phone service providers typically offer customers a set number of minutes for a monthly fee plus a per-minute rate for extra phone usage. What is the pricing strategy being implemented by these cellular phone service providers?

Accepted Answer

Cellular phone service providers are imp

Question 12

What is the difference between peak load pricing and surge pricing? Give an example of when each might be used.

Accepted Answer

Using peak load pricing, a company sets

Question 13

Which of the following occurs when manufacturers or wholesalers attempt to force retailers to charge a certain price for their products?

Accepted Answer

A)  horizontal price fixing 
B)  vertical price fixing 
C)  predatory pricing 
D)  internal reference pricing 
E)  assimilation pricing 
A)  horizontal price fixing 
B)  vertical price fixing 
C)  predatory pricing 
D)  internal reference pricing 
E)  assimilation pricing

Question 14

Application fees, tuition, and fines are all examples of prices.

Accepted Answer

A) True 
 B)False

Question 15

When setting prices, a company must consider factors in its pricing environment. ________ such as the business cycle, economic growth, and consumer confidence can have a significant impact on the firm's pricing strategies.

Accepted Answer

A)  Consumer trends 
B)  Economic trends 
C)  Competitors' responses 
D)  Regulations 
E)  Market structures 
A)  Consumer trends 
B)  Economic trends 
C)  Competitors' responses 
D)  Regulations 
E)  Market structures

Question 16

According to a study of brain scans, consumers who buy something at a discount price experience less satisfaction than people who pay full price for the same product.

Accepted Answer

A) True 
 B)False

Question 17

Keystone pricing is a simple way to determine the markup for a product.

Accepted Answer

A) True 
 B)False

Question 18

Mach 5 razor blades must be used in the Mach 5 razor. Which type of pricing is most likely used for the razor blades?

Accepted Answer

A)  penetration 
B)  value 
C)  captive 
D)  two-part 
E)  uniform delivered 
A)  penetration 
B)  value 
C)  captive 
D)  two-part 
E)  uniform delivered

Question 19

If demand is elastic, will sellers consider lowering their prices? Explain your answer.

Accepted Answer

Yes. A lower price will produc

Question 20

The first step in planning how to price a product is to develop pricing objectives.

Accepted Answer

A) True 
 B)False

What are the advantages and disadvantages of using demand-based pricing?

Swatch surveyed the market and identified an unserved segment of watch buyers. Using these results, Swatch created a watch at a price consumers were willing to pay. The unorthodox order of this marketing mix decision is an example of ________.

A business using price lining is doing which of the following?

Describe what a demand curve is and explain how it helps marketers make decisions.

Explain the pricing strategy being implemented when a retail store places the store's brand items next to the national brand items when the national brand items have a slightly higher price than the store's item. Why would a retailer do this?

Businesses within a purely competitive market have few opportunities to raise or lower their prices.

Some retailers advertise items at very low prices or even below cost just to get customers into the store. The rationale for implementing this ________ strategy is the belief that once a customer is in the store she will buy the advertised item as well as other items at regular prices.

Unlike other currencies, bitcoin is not controlled by a single government entity, such as the U.S. Treasury.

When a beverage maker came out with a new drink and priced it at half price for a month to attract buyers, the company was using a(n) ________ strategy.

Why is price lining a good practice for retailers?

Cellular phone service providers typically offer customers a set number of minutes for a monthly fee plus a per-minute rate for extra phone usage. What is the pricing strategy being implemented by these cellular phone service providers?

What is the difference between peak load pricing and surge pricing? Give an example of when each might be used.

Which of the following occurs when manufacturers or wholesalers attempt to force retailers to charge a certain price for their products?

Application fees, tuition, and fines are all examples of prices.

When setting prices, a company must consider factors in its pricing environment. ________ such as the business cycle, economic growth, and consumer confidence can have a significant impact on the firm's pricing strategies.

According to a study of brain scans, consumers who buy something at a discount price experience less satisfaction than people who pay full price for the same product.

Keystone pricing is a simple way to determine the markup for a product.

Mach 5 razor blades must be used in the Mach 5 razor. Which type of pricing is most likely used for the razor blades?

If demand is elastic, will sellers consider lowering their prices? Explain your answer.

The first step in planning how to price a product is to develop pricing objectives.

Welcome to the World of Marketing: Create and Deliver Value

Global, Ethical, and Sustainable Marketing

Strategic Market Planning

Market Research

Marketing Analytics: Welcome to the Era of Big Data

Understand Consumer and Business Markets

Segmentation, Target Marketing, and Positioning

Product I: Innovation and New Product Development

Product Ii: Product Strategy, Branding, and Product Management

Deliver the Goods: Determine the Distribution Strategy

Deliver the Customer Experience: Goods and Services Via Bricks and Clicks

Promotion I: Advertising and Sales Promotion

Promotion Ii: Social Media, Directdatabase Marketing, Personal Selling, and Public Relations

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Exam 10: Price: What Is the Value Proposition Worth

What are the advantages and disadvantages of using demand-based pricing?

Swatch surveyed the market and identified an unserved segment of watch buyers. Using these results, Swatch created a watch at a price consumers were willing to pay. The unorthodox order of this marketing mix decision is an example of ________.

A business using price lining is doing which of the following?

Describe what a demand curve is and explain how it helps marketers make decisions.

Explain the pricing strategy being implemented when a retail store places the store's brand items next to the national brand items when the national brand items have a slightly higher price than the store's item. Why would a retailer do this?

Businesses within a purely competitive market have few opportunities to raise or lower their prices.

Some retailers advertise items at very low prices or even below cost just to get customers into the store. The rationale for implementing this ________ strategy is the belief that once a customer is in the store she will buy the advertised item as well as other items at regular prices.

Unlike other currencies, bitcoin is not controlled by a single government entity, such as the U.S. Treasury.

When a beverage maker came out with a new drink and priced it at half price for a month to attract buyers, the company was using a(n) ________ strategy.

Why is price lining a good practice for retailers?

Cellular phone service providers typically offer customers a set number of minutes for a monthly fee plus a per-minute rate for extra phone usage. What is the pricing strategy being implemented by these cellular phone service providers?

What is the difference between peak load pricing and surge pricing? Give an example of when each might be used.

Which of the following occurs when manufacturers or wholesalers attempt to force retailers to charge a certain price for their products?

Application fees, tuition, and fines are all examples of prices.

When setting prices, a company must consider factors in its pricing environment. ________ such as the business cycle, economic growth, and consumer confidence can have a significant impact on the firm's pricing strategies.

According to a study of brain scans, consumers who buy something at a discount price experience less satisfaction than people who pay full price for the same product.

Keystone pricing is a simple way to determine the markup for a product.

Mach 5 razor blades must be used in the Mach 5 razor. Which type of pricing is most likely used for the razor blades?

If demand is elastic, will sellers consider lowering their prices? Explain your answer.

The first step in planning how to price a product is to develop pricing objectives.

Welcome to the World of Marketing: Create and Deliver Value

Global, Ethical, and Sustainable Marketing

Strategic Market Planning

Market Research

Marketing Analytics: Welcome to the Era of Big Data

Understand Consumer and Business Markets

Segmentation, Target Marketing, and Positioning

Product I: Innovation and New Product Development

Product Ii: Product Strategy, Branding, and Product Management

Deliver the Goods: Determine the Distribution Strategy

Deliver the Customer Experience: Goods and Services Via Bricks and Clicks

Promotion I: Advertising and Sales Promotion

Promotion Ii: Social Media, Directdatabase Marketing, Personal Selling, and Public Relations

Filters