Question 1

Total costs consist of the sum of the fixed and the variable costs for any given level of production.

Accepted Answer

A) True 
 B)False

Question 2

A firm in a homogeneous market that has the ability to augment its product is more likely to need to meet a competitive price reduction than one that does not have the ability to augment its product.

Accepted Answer

A) True 
 B)False

Question 3

________ pricing takes into account a host of inputs, such as the buyer's image of the product performance, the channel deliverables, the warranty quality, customer support, and attributes such as the supplier's reputation, trustworthiness, and esteem.

Accepted Answer

A)  Perceived-value 
B)  Value 
C)  Going-rate 
D)  Auction-type 
E)  Markup 
A)  Perceived-value 
B)  Value 
C)  Going-rate 
D)  Auction-type 
E)  Markup

Question 4

How can a firm anticipate a competitor's reactions to a price change?

Accepted Answer

One way is to assume the competitor reac

Question 5

Price is one of the two elements of the marketing mix that produces revenue.

Accepted Answer

A) True 
 B)False

Question 6

What circumstances lead companies to initiate price cuts, and what are the traps that companies can fall into if they do?

Accepted Answer

Several circumstances prompt a firm to c

Question 7

A toaster manufacturer has invested $1 million in the business and wants to set a price to earn a 20 percent return on investment, specifically $200,000. What pricing method should it choose?

Accepted Answer

The toaster manufacture should

Question 8

________ reward dealers for participating in advertising and sales support programs.

Accepted Answer

A)  Functional discounts 
B)  Trade discounts 
C)  Promotional allowances 
D)  Rebates 
E)  Quantity discounts 
A)  Functional discounts 
B)  Trade discounts 
C)  Promotional allowances 
D)  Rebates 
E)  Quantity discounts

Question 9

Ellie's manager has asked her to come up with ways to reduce costs of their new product by utilizing a process called "target costing." What should Ellie do?

Accepted Answer

Ellie will have to ask the marketing res

Question 10

When museums charge a lower admission fee to students and senior citizens, this form of pricing is known as ________.

Accepted Answer

A)  perceived value pricing 
B)  third-degree price discrimination 
C)  first-degree price discrimination 
D)  second-degree price discrimination 
E)  psychological discounting 
A)  perceived value pricing 
B)  third-degree price discrimination 
C)  first-degree price discrimination 
D)  second-degree price discrimination 
E)  psychological discounting

Question 11

What questions should a firm consider if it is in a nonhomogeneous market and a competitor lowers its prices?

Accepted Answer

A firm should consider:
∙ Why did the co

Question 12

In the case of prestige goods, the demand curve sometimes slopes upward.

Accepted Answer

A) True 
 B)False

Question 13

What are the different types of price discounts and allowances?

Accepted Answer

The different types of price discounts a

Question 14

Today, consumers are price takers and accept prices at face value or as given.

Accepted Answer

A) True 
 B)False

Question 15

Despite its weaknesses, markup pricing remains popular for which of the following reasons?

Accepted Answer

A)  Sellers can determine demand much more easily than they can estimate costs. 
B)  By tying the price to cost, the pricing task becomes more sophisticated. 
C)  When all firms in the industry use markup pricing, price competition flourishes. 
D)  Sellers take advantage of buyers when the latter's demand becomes acute. 
E)  Many people feel that cost-plus pricing is fairer to both buyers and sellers. 
A)  Sellers can determine demand much more easily than they can estimate costs. 
B)  By tying the price to cost, the pricing task becomes more sophisticated. 
C)  When all firms in the industry use markup pricing, price competition flourishes. 
D)  Sellers take advantage of buyers when the latter's demand becomes acute. 
E)  Many people feel that cost-plus pricing is fairer to both buyers and sellers.

Question 16

Although consumers may have fairly good knowledge of the range of prices involved, very few can accurately recall specific prices of products.

Accepted Answer

A) True 
 B)False

Question 17

Many consumers are willing to pay $100 for a perfume that contains $10 worth of scent because the perfume is from a well-known brand. What does this image pricing suggest about these consumers?

Accepted Answer

A)  They process prices from left to right. 
B)  They use the price as an indicator of quality. 
C)  They are rounding up the price. 
D)  They are remembering an external frame of reference. 
E)  They are breaking the price into smaller units. 
A)  They process prices from left to right. 
B)  They use the price as an indicator of quality. 
C)  They are rounding up the price. 
D)  They are remembering an external frame of reference. 
E)  They are breaking the price into smaller units.

Question 18

When consumers examine products, they often compare an observed price to an internal price they remember. This is known as a(n) ________ price.

Accepted Answer

A)  markup 
B)  reference 
C)  market-skimming 
D)  accumulated 
E)  target 
A)  markup 
B)  reference 
C)  market-skimming 
D)  accumulated 
E)  target

Question 19

ROC Engineering, a Chinese shipbuilding company, agrees to build a fleet of submarines for the Sri Lankan navy, for which it will be paid in the local Sri Lankan currency. As per the agreement, ROC must also spend a substantial amount of the money it generates through this deal within the country. In accordance with the contract, ROC buys Sri Lankan tea at a reduced rate. This is an example of which of the following forms of countertrade?

Accepted Answer

A)  descending bid 
B)  offset 
C)  barter 
D)  compensation deal 
E)  buyback arrangement 
A)  descending bid 
B)  offset 
C)  barter 
D)  compensation deal 
E)  buyback arrangement

Question 20

In ________ pricing, the firm bases its price largely on competitor's prices.

Accepted Answer

A)  going-rate 
B)  auction-type 
C)  markup 
D)  target-return 
E)  perceived-value 
A)  going-rate 
B)  auction-type 
C)  markup 
D)  target-return 
E)  perceived-value

Total costs consist of the sum of the fixed and the variable costs for any given level of production.

A firm in a homogeneous market that has the ability to augment its product is more likely to need to meet a competitive price reduction than one that does not have the ability to augment its product.

________ pricing takes into account a host of inputs, such as the buyer's image of the product performance, the channel deliverables, the warranty quality, customer support, and attributes such as the supplier's reputation, trustworthiness, and esteem.

How can a firm anticipate a competitor's reactions to a price change?

Price is one of the two elements of the marketing mix that produces revenue.

What circumstances lead companies to initiate price cuts, and what are the traps that companies can fall into if they do?

A toaster manufacturer has invested $1 million in the business and wants to set a price to earn a 20 percent return on investment, specifically $200,000. What pricing method should it choose?

________ reward dealers for participating in advertising and sales support programs.

Ellie's manager has asked her to come up with ways to reduce costs of their new product by utilizing a process called "target costing." What should Ellie do?

When museums charge a lower admission fee to students and senior citizens, this form of pricing is known as ________.

What questions should a firm consider if it is in a nonhomogeneous market and a competitor lowers its prices?

In the case of prestige goods, the demand curve sometimes slopes upward.

What are the different types of price discounts and allowances?

Today, consumers are price takers and accept prices at face value or as given.

Despite its weaknesses, markup pricing remains popular for which of the following reasons?

Although consumers may have fairly good knowledge of the range of prices involved, very few can accurately recall specific prices of products.

Many consumers are willing to pay $100 for a perfume that contains $10 worth of scent because the perfume is from a well-known brand. What does this image pricing suggest about these consumers?

When consumers examine products, they often compare an observed price to an internal price they remember. This is known as a(n) ________ price.

In ________ pricing, the firm bases its price largely on competitor's prices.

Defining Marketing for the New Realities

Developing and Implementing Marketing Strategies and Plans

Capturing Marketing Insights and Forecasting Demand

Creating Long-Term Loyalty Relationships

Analyzing Consumer and Business Markets

Identifying Market Segments and Targets

Crafting the Brand Positioning and Competing Effectively

Creating Brand Equity and Driving Growth

Setting Product Strategy and Introducing New Offerings

Designing and Managing Services

Designing and Managing Integrated Marketing Channels

Managing Retailing, Wholesaling, and Logistics

Designing and Managing Integrated Marketing Communications

Managing Mass Communications: Advertising, Sales Promotions, Events and Experiences, and Public Relations

Managing Digital Communications: Online, Social Media, and Mobile

Managing Personal Communications: Direct and Database Marketing and Personal Selling

Tapping Into Global Markets

Filters

Exam 11: Developing Pricing Strategies and Programs

Total costs consist of the sum of the fixed and the variable costs for any given level of production.

A firm in a homogeneous market that has the ability to augment its product is more likely to need to meet a competitive price reduction than one that does not have the ability to augment its product.

________ pricing takes into account a host of inputs, such as the buyer's image of the product performance, the channel deliverables, the warranty quality, customer support, and attributes such as the supplier's reputation, trustworthiness, and esteem.

How can a firm anticipate a competitor's reactions to a price change?

Price is one of the two elements of the marketing mix that produces revenue.

What circumstances lead companies to initiate price cuts, and what are the traps that companies can fall into if they do?

A toaster manufacturer has invested $1 million in the business and wants to set a price to earn a 20 percent return on investment, specifically $200,000. What pricing method should it choose?

________ reward dealers for participating in advertising and sales support programs.

Ellie's manager has asked her to come up with ways to reduce costs of their new product by utilizing a process called "target costing." What should Ellie do?

When museums charge a lower admission fee to students and senior citizens, this form of pricing is known as ________.

What questions should a firm consider if it is in a nonhomogeneous market and a competitor lowers its prices?

In the case of prestige goods, the demand curve sometimes slopes upward.

What are the different types of price discounts and allowances?

Today, consumers are price takers and accept prices at face value or as given.

Despite its weaknesses, markup pricing remains popular for which of the following reasons?

Although consumers may have fairly good knowledge of the range of prices involved, very few can accurately recall specific prices of products.

Many consumers are willing to pay $100 for a perfume that contains $10 worth of scent because the perfume is from a well-known brand. What does this image pricing suggest about these consumers?

When consumers examine products, they often compare an observed price to an internal price they remember. This is known as a(n) ________ price.

In ________ pricing, the firm bases its price largely on competitor's prices.

Defining Marketing for the New Realities

Developing and Implementing Marketing Strategies and Plans

Capturing Marketing Insights and Forecasting Demand

Creating Long-Term Loyalty Relationships

Analyzing Consumer and Business Markets

Identifying Market Segments and Targets

Crafting the Brand Positioning and Competing Effectively

Creating Brand Equity and Driving Growth

Setting Product Strategy and Introducing New Offerings

Designing and Managing Services

Designing and Managing Integrated Marketing Channels

Managing Retailing, Wholesaling, and Logistics

Designing and Managing Integrated Marketing Communications

Managing Mass Communications: Advertising, Sales Promotions, Events and Experiences, and Public Relations

Managing Digital Communications: Online, Social Media, and Mobile

Managing Personal Communications: Direct and Database Marketing and Personal Selling

Tapping Into Global Markets

Filters