Exam 10: Price: What Is the Value Proposition Worth

In a(n) ________, sellers compete for the right to provide a product to a buyer.

After looking at the ads in her Sunday paper, Ruby decided to visit a local nursery and buy potting soil for her plants at $1.99 a bag. The regular price is $4.99 a bag. While Ruby was there she also purchased three bushes, six flowering plants, and a bird bath. You can infer from this information that the nursery used the bags of potting soil as a ________.

When Joe's Coffee Nook raised the price of a latte, Joe noticed a substantial change in his daily latte sales. A price reduction caused his sales to increase. From this information, you can assume the demand for lattes is ________.

When Top-Flite introduced its Strata golf balls with a new dimple design and more solid core for better flight with metal clubs, the price was three times that of regular balls. Pro shops still could not keep them in stock. What is the pricing strategy implemented by Top-Flite, and why did the company choose this strategy?

Captive pricing is illegal.

In price planning, a firm would be most likely to set a profit objective for which of the following products?

Explain the concept of opportunity cost, giving at least one example from your life.

Pricing based on supply and demand is not a part of dynamic pricing.

Price fixing occurs when two or more companies conspire to ________.

Each member of a channel of distribution adds a ________ to create the price at which they will sell the product.

Using ________, a company raises the price of its product as demand goes up and lowers it as demand declines.

The break-even point is the point at which ________.

________ is a pricing tactic a firm uses for two products that work only when used together. The firm sells one item at a very low price and then makes its profit on the second high-margin item.

When setting prices, the company must consider its external pricing environment. Describe three components of the pricing environment and how they affect businesses.

With ________, the seller pays both the cost of loading and transporting the product to the customer.

According to the law of demand, which of the following is true?

Using ________, marketers charge different prices to different customers in order to manage capacity and maximize revenue.

A number of top fashion-modeling agencies were charged with ________ because they were jointly determining what commissions they would charge for models.

When the seller takes on part or all of the cost of shipping, it is called ________.

How does the airline industry implement the yield management pricing strategy?