Question 1

To increase value,marketers may ________,decrease price,or do both.

Accepted Answer

A) decrease promotion 
B) increase benefits 
C) decrease distribution 
D) increase advertising 
E) allow the perceived value of the item to increase as it matures in the life cycle 
A) decrease promotion 
B) increase benefits 
C) decrease distribution 
D) increase advertising 
E) allow the perceived value of the item to increase as it matures in the life cycle

Question 2

Calculate a firm's profit using the following information: the unit price (P)for a product is $40;the quantity sold (Q)is 2,000;the fixed cost (FC)is $50,000;and the variable cost (VC)is $20,000.

Accepted Answer

A) $10,000 
B) $50,000 
C) $110,000 
D) $150,000 
E) cannot be determined with the information provided 
A) $10,000 
B) $50,000 
C) $110,000 
D) $150,000 
E) cannot be determined with the information provided

Question 3

Microsoft,Sony,and Nintendo are the three principal firms in the video game console market.How much price competition is most likely for video game makers?

Accepted Answer

A) There is almost none;the market sets the price. 
B) There is vigorous competition and common price wars to drive small competitors out. 
C) There is generally a price leader that sets the price. 
D) Each firm is aware of each other's prices and may adjust prices accordingly. 
E) Price is set by the seller but regulated by the government. 
A) There is almost none;the market sets the price. 
B) There is vigorous competition and common price wars to drive small competitors out. 
C) There is generally a price leader that sets the price. 
D) Each firm is aware of each other's prices and may adjust prices accordingly. 
E) Price is set by the seller but regulated by the government.

Question 4

Which of the following would be an example of a fixed cost for a company that makes carbon monoxide monitoring systems for workers to wear in hazardous areas?

Accepted Answer

A) the lithium batteries that are used in each monitor 
B) the chest harness used to wear the monitor 
C) the insurance for the company's factory 
D) the free training videos that are sent to each new customer 
E) the stainless-steel,water-resistant cases in which the monitors are stored 
A) the lithium batteries that are used in each monitor 
B) the chest harness used to wear the monitor 
C) the insurance for the company's factory 
D) the free training videos that are sent to each new customer 
E) the stainless-steel,water-resistant cases in which the monitors are stored

Question 5

Managing for long-run profits as a pricing objective implies that a company will

Accepted Answer

A) give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets. 
B) maintain a given price range to ensure there is no loss of customers over time,even if the profit margin declines. 
C) invest excess cash in bonds and certificates of deposit in order to counteract any inflationary economic changes in the future. 
D) reinvest all profits into market research or product research rather than returned to shareholders. 
E) drop all products,product lines,or divisions that cannot maintain their pricing goals. 
A) give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets. 
B) maintain a given price range to ensure there is no loss of customers over time,even if the profit margin declines. 
C) invest excess cash in bonds and certificates of deposit in order to counteract any inflationary economic changes in the future. 
D) reinvest all profits into market research or product research rather than returned to shareholders. 
E) drop all products,product lines,or divisions that cannot maintain their pricing goals.

Question 6

The largest U.S.-based TV maker is

Accepted Answer

A) Sharp. 
B) Panasonic. 
C) LG. 
D) Sony. 
E) VIZIO. 
A) Sharp. 
B) Panasonic. 
C) LG. 
D) Sony. 
E) VIZIO.

Question 7

What are the six broad objectives that an organization may pursue that tie in directly to its pricing policies?

Accepted Answer

The six broad objectives that

Question 8

The ratio of ________ to price is referred to as value.

Accepted Answer

A) prestige rating 
B) perceived benefits 
C) costs 
D) anticipated quality 
E) profits 
A) prestige rating 
B) perceived benefits 
C) costs 
D) anticipated quality 
E) profits

Question 9

Recently,much of the Western United States experienced drought conditions and water usage was restricted in Denver.Yet,even though most people used less water,the price of water did not drop.When the drought was declared over,the water company raised water prices.However,the residents of Denver did not use less water.Here,water is

Accepted Answer

A) price elastic. 
B) price sensitive. 
C) price inelastic. 
D) price insensitive. 
E) unitary elastic. 
A) price elastic. 
B) price sensitive. 
C) price inelastic. 
D) price insensitive. 
E) unitary elastic.

Question 10

The particular type of competition dramatically influences the range of price competition and,in turn,

Accepted Answer

A) the nature of product differentiation and extent of advertising. 
B) the nature of product differentiation and requirements for on-hand inventory. 
C) the degree of involvement with each of the organization's stakeholders. 
D) the degree of involvement with both retailers and wholesalers. 
E) the relationship between product lines and product classes. 
A) the nature of product differentiation and extent of advertising. 
B) the nature of product differentiation and requirements for on-hand inventory. 
C) the degree of involvement with each of the organization's stakeholders. 
D) the degree of involvement with both retailers and wholesalers. 
E) the relationship between product lines and product classes.

Question 11

Figure 13-4B
  
-A shift of the demand curve from D₂ to D₃ in Figure 13-4B above indicates

Accepted Answer

A) fewer units are demanded at the given price. 
B) more units are demanded at the given price. 
C) the price has decreased. 
D) the price has increased. 
E) there is not enough information given to indicate what happened. 
A) fewer units are demanded at the given price. 
B) more units are demanded at the given price. 
C) the price has decreased. 
D) the price has increased. 
E) there is not enough information given to indicate what happened.

Question 12

Figure 13-4A
  
-Figure 13-4A above shows that when the price for Red Baron frozen cheese pizzas moves from $8 to $6 per unit along the demand curve D₁,the quantity demanded

Accepted Answer

A) increases from 2 to 3 million units per year. 
B) decreases from 3 to 2 million units per year. 
C) stays the same. 
D) increases from 6 to 8 million units per year. 
E) decreases from 8 to 6 million units per year. 
A) increases from 2 to 3 million units per year. 
B) decreases from 3 to 2 million units per year. 
C) stays the same. 
D) increases from 6 to 8 million units per year. 
E) decreases from 8 to 6 million units per year.

Question 13

Basic to setting a product's price is the extent of ________.This information is used in estimating the revenues the firm expects to receive.

Accepted Answer

A) management's commitment to the product relative to other products in the line 
B) the product line into which it will be introduced 
C) customer demand for it 
D) the firm's promotional budget 
E) distribution requirements 
A) management's commitment to the product relative to other products in the line 
B) the product line into which it will be introduced 
C) customer demand for it 
D) the firm's promotional budget 
E) distribution requirements

Question 14

Figure 13-4B
  
-Which of the following would most likely account for the shift in the demand curve from D₂ to D₃ shown in Figure 13-4B above?

Accepted Answer

A) The firm increased its prices and consumers perceived the value of the product to be greater. 
B) There were more product substitutes available in the marketplace. 
C) Competitors in the market lowered their prices. 
D) A recession occurred that lowered consumers' incomes. 
E) The product became trendy among members of its target market. 
A) The firm increased its prices and consumers perceived the value of the product to be greater. 
B) There were more product substitutes available in the marketplace. 
C) Competitors in the market lowered their prices. 
D) A recession occurred that lowered consumers' incomes. 
E) The product became trendy among members of its target market.

Question 15

Companies must know or anticipate what specific prices its present and potential competitors currently charge

Accepted Answer

A) or may charge in the near future. 
B) only when these are considered permanent prices. 
C) primarily if they intend to compete on price rather than a form of differentiation like customer service. 
D) primarily if they intend to target price sensitive target markets. 
E) if there are legal requirements for pricing in their industry. 
A) or may charge in the near future. 
B) only when these are considered permanent prices. 
C) primarily if they intend to compete on price rather than a form of differentiation like customer service. 
D) primarily if they intend to target price sensitive target markets. 
E) if there are legal requirements for pricing in their industry.

Question 16

The percentage change in quantity demanded relative to the percentage change in price is referred to as

Accepted Answer

A) price elasticity of demand. 
B) demand derivative of price. 
C) average demand. 
D) marginal revenue. 
E) derived demand. 
A) price elasticity of demand. 
B) demand derivative of price. 
C) average demand. 
D) marginal revenue. 
E) derived demand.

Question 17

The horizontal axis of a demand curve graph represents

Accepted Answer

A) market growth rate. 
B) relative market share. 
C) price per unit. 
D) potential profit in dollars. 
E) quantity demanded. 
A) market growth rate. 
B) relative market share. 
C) price per unit. 
D) potential profit in dollars. 
E) quantity demanded.

Question 18

Marketing executives must translate estimates of customer demand into estimates of

Accepted Answer

A) human and other resources required. 
B) advertising expenditures that will be required. 
C) ancillary product support. 
D) revenues the firm expects to receive. 
E) supply with a demand curve. 
A) human and other resources required. 
B) advertising expenditures that will be required. 
C) ancillary product support. 
D) revenues the firm expects to receive. 
E) supply with a demand curve.

Question 19

A firm may forgo a higher profit on sales and follow which of the following pricing objectives because it wants to recognize its stakeholder obligations?

Accepted Answer

A) profit 
B) market share 
C) unit volume 
D) survival 
E) social responsibility 
A) profit 
B) market share 
C) unit volume 
D) survival 
E) social responsibility

Question 20

All of the following are legal or ethical considerations when setting a final price except which?

Accepted Answer

A) geographical pricing 
B) predatory pricing 
C) price matching 
D) price fixing 
E) deceptive pricing 
A) geographical pricing 
B) predatory pricing 
C) price matching 
D) price fixing 
E) deceptive pricing

Exam 13: Building the Price Foundation

To increase value,marketers may ________,decrease price,or do both.

Calculate a firm's profit using the following information: the unit price (P)for a product is $40;the quantity sold (Q)is 2,000;the fixed cost (FC)is $50,000;and the variable cost (VC)is $20,000.

Microsoft,Sony,and Nintendo are the three principal firms in the video game console market.How much price competition is most likely for video game makers?

Which of the following would be an example of a fixed cost for a company that makes carbon monoxide monitoring systems for workers to wear in hazardous areas?

Managing for long-run profits as a pricing objective implies that a company will

The largest U.S.-based TV maker is

What are the six broad objectives that an organization may pursue that tie in directly to its pricing policies?

The ratio of ________ to price is referred to as value.

The particular type of competition dramatically influences the range of price competition and,in turn,

Figure 13-4B -A shift of the demand curve from D₂ to D₃ in Figure 13-4B above indicates

Figure 13-4A -Figure 13-4A above shows that when the price for Red Baron frozen cheese pizzas moves from $8 to $6 per unit along the demand curve D₁,the quantity demanded

Basic to setting a product's price is the extent of ________.This information is used in estimating the revenues the firm expects to receive.

Figure 13-4B -Which of the following would most likely account for the shift in the demand curve from D₂ to D₃ shown in Figure 13-4B above?

Companies must know or anticipate what specific prices its present and potential competitors currently charge

The percentage change in quantity demanded relative to the percentage change in price is referred to as

The horizontal axis of a demand curve graph represents

Marketing executives must translate estimates of customer demand into estimates of

A firm may forgo a higher profit on sales and follow which of the following pricing objectives because it wants to recognize its stakeholder obligations?

All of the following are legal or ethical considerations when setting a final price except which?

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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