Question 1

A firm's profit objective is often measured in terms of ROI.The acronym ROI stands for

Accepted Answer

A) risk opportunity investment. 
B) revised organizational incentives. 
C) return on investment. 
D) regulated organizational investments. 
E) replenishment of organizational inventories. 
A) risk opportunity investment. 
B) revised organizational incentives. 
C) return on investment. 
D) regulated organizational investments. 
E) replenishment of organizational inventories.

Question 2

Explain the price equation in the context of a new car purchase.

Accepted Answer

The price equation is: Final price = Lis

Question 3

What factors determine price elasticity of demand?

Accepted Answer

Price elasticity of demand is determined

Question 4

Insurance premiums,entrance fees,train fares,and organization dues are all examples of

Accepted Answer

A) charges. 
B) barter. 
C) profit. 
D) price. 
E) outlays. 
A) charges. 
B) barter. 
C) profit. 
D) price. 
E) outlays.

Question 5

Economists have identified four types of competitive markets: pure monopoly,monopolistic competition,oligopoly,and

Accepted Answer

A) pure competition. 
B) government-dominated. 
C) capitalist. 
D) socialist. 
E) communist. 
A) pure competition. 
B) government-dominated. 
C) capitalist. 
D) socialist. 
E) communist.

Question 6

Demand for a product is likely to be more price elastic if it

Accepted Answer

A) is considered a necessity. 
B) has many substitutes. 
C) is at the mature stage of the product life cycle. 
D) requires a small cash outlay. 
E) is nondiscretionary. 
A) is considered a necessity. 
B) has many substitutes. 
C) is at the mature stage of the product life cycle. 
D) requires a small cash outlay. 
E) is nondiscretionary.

Question 7

According to the price equation,a product's or service's final price equals its list price minus incentives and allowances plus

Accepted Answer

A) profits. 
B) commissions. 
C) trade-ins. 
D) extra fees. 
E) taxes. 
A) profits. 
B) commissions. 
C) trade-ins. 
D) extra fees. 
E) taxes.

Question 8

Pure monopoly is the competitive market situation where

Accepted Answer

A) many sellers follow market price for identical,commodity products. 
B) one seller sets the price for a unique product. 
C) few sellers compete,and are sensitive to one another's prices. 
D) many sellers compete on nonprice factors. 
E) one or a few sellers compete solely on nonprice factors. 
A) many sellers follow market price for identical,commodity products. 
B) one seller sets the price for a unique product. 
C) few sellers compete,and are sensitive to one another's prices. 
D) many sellers compete on nonprice factors. 
E) one or a few sellers compete solely on nonprice factors.

Question 9

The newer a product and the earlier it is in its life cycle,

Accepted Answer

A) the lower the price the firm must charge. 
B) the more competition it has. 
C) the higher is the price that can usually be charged. 
D) the lower its production costs are. 
E) the lower its unit variable cost is. 
A) the lower the price the firm must charge. 
B) the more competition it has. 
C) the higher is the price that can usually be charged. 
D) the lower its production costs are. 
E) the lower its unit variable cost is.

Question 10

Most public utilities must petition regulatory commissions in order to obtain a rate increase.Which pricing constraint does this statement demonstrate?

Accepted Answer

A) demand for the product,class,or brand 
B) newness of product in the life cycle 
C) costs of production 
D) type of competitive market 
E) single product versus a product line 
A) demand for the product,class,or brand 
B) newness of product in the life cycle 
C) costs of production 
D) type of competitive market 
E) single product versus a product line

Question 11

The sum of the firm's expenses that change with the quantity of the product that is produced and sold is referred to as

Accepted Answer

A) fixed cost. 
B) total cost. 
C) marginal cost. 
D) unit cost. 
E) variable cost. 
A) fixed cost. 
B) total cost. 
C) marginal cost. 
D) unit cost. 
E) variable cost.

Question 12

Figure 13-7
  
-Suppose you are the owner of a picture frame store.Assume that the average price customers are willing to pay for each picture frame is $120.Also,suppose your fixed costs (FC)total $32,000 (real estate taxes,interest on a bank loan,etc. )and unit variable cost (UVC)for a picture frame is $40 (labor,glass,frame,and matting).According to Figure 13-7 above,how much profit will your picture frame store make if it sells 400 picture frames?

Accepted Answer

A) $48,000 
B) $32,000 
C) $16,000 
D) $0 
E) ($32,000) 
A) $48,000 
B) $32,000 
C) $16,000 
D) $0 
E) ($32,000)

Question 13

Which of the following statements regarding pricing constraints is most accurate?

Accepted Answer

A) When a product is in the introductory stage of the product life cycle,the initial price must be low since consumers still don't know what the product can really do. 
B) Patents and limited competition earlier the product life cycle mean that higher prices can usually be charged. 
C) The greater the number of products in a company's product line,the less the product features of similar products can affect price. 
D) The newest addition to a company's product line should always have the highest price in order to maintain the value of existing brands. 
E) To avoid cannibalization,the newest product addition to a company's product line should never have a price lower than the other offerings in the line. 
A) When a product is in the introductory stage of the product life cycle,the initial price must be low since consumers still don't know what the product can really do. 
B) Patents and limited competition earlier the product life cycle mean that higher prices can usually be charged. 
C) The greater the number of products in a company's product line,the less the product features of similar products can affect price. 
D) The newest addition to a company's product line should always have the highest price in order to maintain the value of existing brands. 
E) To avoid cannibalization,the newest product addition to a company's product line should never have a price lower than the other offerings in the line.

Question 14

Which of the following statements regarding sales goals is most accurate?

Accepted Answer

A) For marketing managers,sales revenue or unit sales can be easily translated into meaningful targets for a product line or brand. 
B) Cutting prices for a single product in a product line to raise unit sales often results in an increase in sales for related products in the line. 
C) Very often,cutting prices results in a decrease in market share. 
D) Setting unit volume sales as a pricing objective results in price wars with competitors,so the practice is limited to industries with few competitors. 
E) An advantage of increasing unit volume sales is that it always results in an increase in profits. 
A) For marketing managers,sales revenue or unit sales can be easily translated into meaningful targets for a product line or brand. 
B) Cutting prices for a single product in a product line to raise unit sales often results in an increase in sales for related products in the line. 
C) Very often,cutting prices results in a decrease in market share. 
D) Setting unit volume sales as a pricing objective results in price wars with competitors,so the practice is limited to industries with few competitors. 
E) An advantage of increasing unit volume sales is that it always results in an increase in profits.

Question 15

The ratio of perceived benefits to price is referred to as

Accepted Answer

A) the price-quality relationship. 
B) customer-value pricing. 
C) value-added pricing. 
D) value analysis. 
E) value. 
A) the price-quality relationship. 
B) customer-value pricing. 
C) value-added pricing. 
D) value analysis. 
E) value.

Question 16

Ampro-Mag makes materials for safely controlling hazardous spills of all kinds.It sells these items as a neutralizing kit priced at $100.The costs of the materials that go into each kit are $45.It costs $5 in labor to assemble a kit.The company has monthly expenses of $1,000 for rent and insurance,$200 for heat and electricity,$500 for advertising in trade journals,and $3,500 for the monthly salary of its owner.What is Ampro-Mag's monthly break-even point in terms of number of neutralizing kits sold?

Accepted Answer

A) 40 kits 
B) 52 kits 
C) 104 kits 
D) 116 kits 
E) 520 kits 
A) 40 kits 
B) 52 kits 
C) 104 kits 
D) 116 kits 
E) 520 kits

Question 17

Price elasticity of demand is determined by a number of factors,such as the availability of substitutes,the necessity of the product or service,and

Accepted Answer

A) the cash outlay of the purchase relative to a person's disposable income. 
B) the stage of the product or service in its product life cycle. 
C) the degree of carrying costs for the manufacturer or distributor. 
D) the financial resources of the organization itself. 
E) the ability of the organization to meet sudden increases in demand. 
A) the cash outlay of the purchase relative to a person's disposable income. 
B) the stage of the product or service in its product life cycle. 
C) the degree of carrying costs for the manufacturer or distributor. 
D) the financial resources of the organization itself. 
E) the ability of the organization to meet sudden increases in demand.

Question 18

From a marketing viewpoint,________ is the money or other considerations (including other products and services)exchanged for the ownership or use of a product or service.

Accepted Answer

A) value 
B) price 
C) barter 
D) currency 
E) a tariff 
A) value 
B) price 
C) barter 
D) currency 
E) a tariff

Question 19

Which of the following statements regarding the seller's price is most accurate?

Accepted Answer

A) Internet price changes are regulated by the Internet Fair Practices Act to protect consumers against price gouging. 
B) The seller's price is constrained by the type of market within which it competes. 
C) Price changes cannot be regulated in a monopoly. 
D) The type of market has little or no impact on a firm in a monopolistic competitive environment. 
E) Competitive environments should affect a firm's pricing objectives,but not its actual product prices. 
A) Internet price changes are regulated by the Internet Fair Practices Act to protect consumers against price gouging. 
B) The seller's price is constrained by the type of market within which it competes. 
C) Price changes cannot be regulated in a monopoly. 
D) The type of market has little or no impact on a firm in a monopolistic competitive environment. 
E) Competitive environments should affect a firm's pricing objectives,but not its actual product prices.

Question 20

Barter is the practice of exchanging products and services for other products and services rather than for

Accepted Answer

A) value. 
B) ideas. 
C) promises. 
D) tariffs. 
E) money. 
A) value. 
B) ideas. 
C) promises. 
D) tariffs. 
E) money.

Exam 13: Building the Price Foundation

A firm's profit objective is often measured in terms of ROI.The acronym ROI stands for

Explain the price equation in the context of a new car purchase.

What factors determine price elasticity of demand?

Insurance premiums,entrance fees,train fares,and organization dues are all examples of

Economists have identified four types of competitive markets: pure monopoly,monopolistic competition,oligopoly,and

Demand for a product is likely to be more price elastic if it

According to the price equation,a product's or service's final price equals its list price minus incentives and allowances plus

Pure monopoly is the competitive market situation where

The newer a product and the earlier it is in its life cycle,

Most public utilities must petition regulatory commissions in order to obtain a rate increase.Which pricing constraint does this statement demonstrate?

The sum of the firm's expenses that change with the quantity of the product that is produced and sold is referred to as

Which of the following statements regarding pricing constraints is most accurate?

Which of the following statements regarding sales goals is most accurate?

The ratio of perceived benefits to price is referred to as

Price elasticity of demand is determined by a number of factors,such as the availability of substitutes,the necessity of the product or service,and

From a marketing viewpoint,________ is the money or other considerations (including other products and services)exchanged for the ownership or use of a product or service.

Which of the following statements regarding the seller's price is most accurate?

Barter is the practice of exchanging products and services for other products and services rather than for

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Scanning the Marketing Environment

Ethical and Social Responsibility for Sustainable Marketing

Understanding Consumer Behavior

Understanding Organizations As Customers

Understanding and Reaching Global Consumers and Markets

Marketing Research: From Customer Insights to Actions

Market Segmentation, targeting, and Positioning

Developing New Products and Services

Managing Successful Products, services, and Brands

Services Marketing

Arriving at the Final Price

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Integrated Marketing Communications and Direct Marketing

Advertising,sales Promotion,and Public Relations

Using Social Media and Mobile Marketing to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multichannel Marketing

Pulling It All Together: the Strategic Marketing Process

Writing Successful Marketing and Business Plans: Tips and Guidelines

Financial Statements and Ratios

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