Question 1

Which of the following statements regarding price changes is most accurate?

Accepted Answer

A) Prices for tangible goods should change monthly,whereas service prices should change quarterly. 
B) Changing a product's price too frequently creates antagonism among consumers,yet changing prices too infrequently makes them feel the company is not improving its product sufficiently. 
C) Supermarkets should change their prices every week since customers are expecting new prices in the weekly flyers they receive in the mail. 
D) Companies selling products over the Internet can instantly change their prices whenever the need arises. 
E) Internet price changes are regulated by the Internet Fair Practices Act to protect consumers against price gouging. 
A) Prices for tangible goods should change monthly,whereas service prices should change quarterly. 
B) Changing a product's price too frequently creates antagonism among consumers,yet changing prices too infrequently makes them feel the company is not improving its product sufficiently. 
C) Supermarkets should change their prices every week since customers are expecting new prices in the weekly flyers they receive in the mail. 
D) Companies selling products over the Internet can instantly change their prices whenever the need arises. 
E) Internet price changes are regulated by the Internet Fair Practices Act to protect consumers against price gouging.

Question 2

The ratio of perceived benefits to ________ is referred to as value.

Accepted Answer

A) price 
B) prestige 
C) perceived quality 
D) profits 
E) discounts 
A) price 
B) prestige 
C) perceived quality 
D) profits 
E) discounts

Question 3

Market share is the ratio of the ________ to those of the industry,including the firm itself.

Accepted Answer

A) target return on sales 
B) marginal profit of the firm 
C) firm's sales revenues or unit sales 
D) marketing expenses of the firm 
E) profits of the firm 
A) target return on sales 
B) marginal profit of the firm 
C) firm's sales revenues or unit sales 
D) marketing expenses of the firm 
E) profits of the firm

Question 4

Suppose you are the owner of a picture frame store and you wish to calculate how many frames you must sell to cover your fixed and variable costs at a given price.Let's assume that the demand for your frames is strong,so 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).If your picture frame store sold 2,000 picture frames,what would your profit (or loss)be?

Accepted Answer

A) a loss of $32,000 
B) $0 
C) $32,000 profit 
D) $112,000 profit 
E) $128,000 profit 
A) a loss of $32,000 
B) $0 
C) $32,000 profit 
D) $112,000 profit 
E) $128,000 profit

Question 5

Step 1 of the price-setting process identifies pricing objectives and constraints.Describe the reasons these objectives may change and give examples of objectives a firm may set.

Accepted Answer

Pricing objectives involve specifying th

Question 6

Rent,executive salaries,and insurance are typical examples of

Accepted Answer

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

Question 7

What is the difference between a movement along a demand curve and a shift of a demand curve?

Accepted Answer

A movement along a demand curve assumes

Question 8

Which of the following would be an example of a constraint in Step 1 of the price-setting process?

Accepted Answer

A) We can rely on our reputation for our other products in the line. 
B) Experts are predicting a surge in global demand. 
C) We need to make allowances for large quantity orders. 
D) We should increase the price during the holiday shopping season. 
E) Remember,we don't know what the demand for this new product will be. 
A) We can rely on our reputation for our other products in the line. 
B) Experts are predicting a surge in global demand. 
C) We need to make allowances for large quantity orders. 
D) We should increase the price during the holiday shopping season. 
E) Remember,we don't know what the demand for this new product will be.

Question 9

A movement along a demand curve (up or down)for a product occurs ________,assuming that other factors such as consumer tastes,price and availability of substitutes,and consumer incomes remain unchanged.

Accepted Answer

A) when its price is lowered or increased and the quantity demanded for it correspondingly increases or decreases 
B) when its demand is lowered or increased and the price offered for it correspondingly increases or decreases 
C) when its demand and price are lowered 
D) when its demand and price are increased 
E) at the break-even point 
A) when its price is lowered or increased and the quantity demanded for it correspondingly increases or decreases 
B) when its demand is lowered or increased and the price offered for it correspondingly increases or decreases 
C) when its demand and price are lowered 
D) when its demand and price are increased 
E) at the break-even point

Question 10

The break-even point (BEP)= [Fixed cost ÷ (Unit price − ________)].

Accepted Answer

A) Total cost 
B) Total expense 
C) Marginal revenue 
D) Unit variable cost 
E) Total number of units produced or quantity 
A) Total cost 
B) Total expense 
C) Marginal revenue 
D) Unit variable cost 
E) Total number of units produced or quantity

Question 11

Demand factors are

Accepted Answer

A) the number of consumers who can afford to purchase a product or service. 
B) the price that should be charged for a given product. 
C) elements that determine consumers' willingness and ability to pay for products. 
D) the number of consumers who want to purchase a product. 
E) the number of consumers who can purchase a product. 
A) the number of consumers who can afford to purchase a product or service. 
B) the price that should be charged for a given product. 
C) elements that determine consumers' willingness and ability to pay for products. 
D) the number of consumers who want to purchase a product. 
E) the number of consumers who can purchase a product.

Question 12

In the process of setting price,a marketer must first identify pricing objectives and constraints.Next,in Step 2,three specific estimates are necessary.What are they?

Accepted Answer

The three key items in Step 2

Question 13

Figure 13-3
  
-In Figure 13-3 above,column D represents which type of competitive market?

Accepted Answer

A) an oligopoly 
B) monopolistic competition 
C) a pure monopoly 
D) pure competition 
E) oligopolistic competition 
A) an oligopoly 
B) monopolistic competition 
C) a pure monopoly 
D) pure competition 
E) oligopolistic competition

Question 14

If you know the contents and price of a McDonald's Extra Value Meal,it may serve as ________ to you when you visit other fast-food restaurants and consider the purchase of a meal option there.

Accepted Answer

A) a marginal analysis 
B) a profit equation 
C) a reference value 
D) a break-even analysis 
E) price elasticity of demand 
A) a marginal analysis 
B) a profit equation 
C) a reference value 
D) a break-even analysis 
E) price elasticity of demand

Question 15

Figure 13-7
  
-The break-even chart for a picture frame store in Figure 13-7 above shows that by selling 200 pictures,the store will

Accepted Answer

A) break even. 
B) earn a profit. 
C) incur a loss. 
D) have no fixed costs. 
E) have no variable costs. 
A) break even. 
B) earn a profit. 
C) incur a loss. 
D) have no fixed costs. 
E) have no variable costs.

Question 16

All of the following are examples of pricing constraints except which?

Accepted Answer

A) familiarity of the product 
B) competitors' prices 
C) newness of the product 
D) unit volume 
E) demand for the product class,product,or brand 
A) familiarity of the product 
B) competitors' prices 
C) newness of the product 
D) unit volume 
E) demand for the product class,product,or brand

Question 17

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

Accepted Answer

A) Pricing objectives should never change. 
B) Pricing objectives may change depending on the success of a company's products. 
C) Pricing objectives may change depending upon the cost of advertising. 
D) Pricing objectives are established exclusively by the marketing department. 
E) Pricing objectives are extremely sensitive to even the slightest change in the local economy. 
A) Pricing objectives should never change. 
B) Pricing objectives may change depending on the success of a company's products. 
C) Pricing objectives may change depending upon the cost of advertising. 
D) Pricing objectives are established exclusively by the marketing department. 
E) Pricing objectives are extremely sensitive to even the slightest change in the local economy.

Question 18

The competitive market situation in which one seller sets the price for a unique product is referred to as

Accepted Answer

A) pure monopoly. 
B) oligopoly. 
C) monopolistic competition. 
D) pure competition. 
E) monopolistic oligopoly. 
A) pure monopoly. 
B) oligopoly. 
C) monopolistic competition. 
D) pure competition. 
E) monopolistic oligopoly.

Question 19

Three different objectives relate to a firm's profit.One objective,known as ________,is common in many firms because the targets can be set and performance measured quickly.

Accepted Answer

A) managing for long-run profits 
B) target return 
C) break-even strategy 
D) maximizing current profit 
E) minimizing risk 
A) managing for long-run profits 
B) target return 
C) break-even strategy 
D) maximizing current profit 
E) minimizing risk

Question 20

Companies often pursue a market share objective when

Accepted Answer

A) industry sales are flat or declining. 
B) profits are increasing. 
C) industry sales are beginning to rise. 
D) there is a sudden increase in production costs. 
E) stockholders are seeking higher dividends. 
A) industry sales are flat or declining. 
B) profits are increasing. 
C) industry sales are beginning to rise. 
D) there is a sudden increase in production costs. 
E) stockholders are seeking higher dividends.

Exam 13: Building the Price Foundation

Which of the following statements regarding price changes is most accurate?

The ratio of perceived benefits to ________ is referred to as value.

Market share is the ratio of the ________ to those of the industry,including the firm itself.

Step 1 of the price-setting process identifies pricing objectives and constraints.Describe the reasons these objectives may change and give examples of objectives a firm may set.

Rent,executive salaries,and insurance are typical examples of

What is the difference between a movement along a demand curve and a shift of a demand curve?

Which of the following would be an example of a constraint in Step 1 of the price-setting process?

A movement along a demand curve (up or down)for a product occurs ________,assuming that other factors such as consumer tastes,price and availability of substitutes,and consumer incomes remain unchanged.

The break-even point (BEP)= [Fixed cost ÷ (Unit price − ________)].

Demand factors are

In the process of setting price,a marketer must first identify pricing objectives and constraints.Next,in Step 2,three specific estimates are necessary.What are they?

Figure 13-3 -In Figure 13-3 above,column D represents which type of competitive market?

If you know the contents and price of a McDonald's Extra Value Meal,it may serve as ________ to you when you visit other fast-food restaurants and consider the purchase of a meal option there.

Figure 13-7 -The break-even chart for a picture frame store in Figure 13-7 above shows that by selling 200 pictures,the store will

All of the following are examples of pricing constraints except which?

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

The competitive market situation in which one seller sets the price for a unique product is referred to as

Three different objectives relate to a firm's profit.One objective,known as ________,is common in many firms because the targets can be set and performance measured quickly.

Companies often pursue a market share objective when

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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

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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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