Question 1

Figure 13-3
  
-In Figure 13-3 above,column C 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 2

Which of the following statements regarding a market share pricing objective is most accurate?

Accepted Answer

A) A market share objective is often difficult for product managers since stockholders are looking for immediate dividends (return of profits). 
B) Although increased market share is a primary goal of some firms,others see it as a means to other ends,such as increased sales or profits. 
C) Selecting market share as a pricing objective is particularly effective if industry sales are rising. 
D) An advantage of market share as a pricing objective is that it is particularly insensitive to competitors' actions. 
E) Ironically,a market share objective is realized by raising prices in order to increase consumer confidence during the decline stage of a product's life cycle. 
A) A market share objective is often difficult for product managers since stockholders are looking for immediate dividends (return of profits). 
B) Although increased market share is a primary goal of some firms,others see it as a means to other ends,such as increased sales or profits. 
C) Selecting market share as a pricing objective is particularly effective if industry sales are rising. 
D) An advantage of market share as a pricing objective is that it is particularly insensitive to competitors' actions. 
E) Ironically,a market share objective is realized by raising prices in order to increase consumer confidence during the decline stage of a product's life cycle.

Question 3

Total cost refers to

Accepted Answer

A) the sum of the expenses of the firm that are stable and do not change with the quantity of a product that is produced and sold. 
B) the change in expenses that results from producing and marketing one additional unit of a product. 
C) the average amount of money received for selling one unit of a product or simply the price of that unit. 
D) the sum of the expenses of the firm that vary directly with the quantity of a product that is produced and sold. 
E) the total expense incurred by a firm in producing and marketing a product,which equals the sum of fixed cost and variable cost. 
A) the sum of the expenses of the firm that are stable and do not change with the quantity of a product that is produced and sold. 
B) the change in expenses that results from producing and marketing one additional unit of a product. 
C) the average amount of money received for selling one unit of a product or simply the price of that unit. 
D) the sum of the expenses of the firm that vary directly with the quantity of a product that is produced and sold. 
E) the total expense incurred by a firm in producing and marketing a product,which equals the sum of fixed cost and variable cost.

Question 4

There are four major cereal brands-Kellogg's,Quaker,General Mills,and Post-that seem to occupy most of the shelf space in a typical grocery store.These cereals are all priced about the same.There is a good deal of product differentiation,from characters to different health claims.The cereal industry is an example of what type of competitive market?

Accepted Answer

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

Question 5

Which of the following statements is most accurate?

Accepted Answer

A) Nonprofit organizations are exempt from having to cover the costs of producing and/or marketing their products. 
B) Socially responsible corporations should have the pricing constraint of covering all costs of producing and marketing their products,but they should not price their products to earn a profit. 
C) Marketers must ensure that firms in their channels of distribution make an adequate profit or they will be cut off from their customers. 
D) Price elasticity of demand makes it virtually impossible for companies to cover all their marketing and production costs at all times. 
E) Marketing and production costs are the most difficult and expensive aspect of pricing because they draw so much capital away from other departments in the organization. 
A) Nonprofit organizations are exempt from having to cover the costs of producing and/or marketing their products. 
B) Socially responsible corporations should have the pricing constraint of covering all costs of producing and marketing their products,but they should not price their products to earn a profit. 
C) Marketers must ensure that firms in their channels of distribution make an adequate profit or they will be cut off from their customers. 
D) Price elasticity of demand makes it virtually impossible for companies to cover all their marketing and production costs at all times. 
E) Marketing and production costs are the most difficult and expensive aspect of pricing because they draw so much capital away from other departments in the organization.

Question 6

A reference value is developed by the consumer through

Accepted Answer

A) considering the amount of time and energy a consumer puts into the purchase process. 
B) judging the value assigned to similar items used by the consumer's peers. 
C) performing a careful break-even analysis. 
D) comparing the costs and benefits of substitute items. 
E) examining the true difference between customers' "needs" and "wants." 
A) considering the amount of time and energy a consumer puts into the purchase process. 
B) judging the value assigned to similar items used by the consumer's peers. 
C) performing a careful break-even analysis. 
D) comparing the costs and benefits of substitute items. 
E) examining the true difference between customers' "needs" and "wants."

Question 7

Which of the following illustrates movement along the demand curve?

Accepted Answer

A) Demand increases due to a drop in price. 
B) Demand increases due to a competitor leaving the market. 
C) Demand increases due to consumer tastes changing. 
D) Demand increases due to a competitor increasing its prices. 
E) Demand increases due to an increase in consumer incomes. 
A) Demand increases due to a drop in price. 
B) Demand increases due to a competitor leaving the market. 
C) Demand increases due to consumer tastes changing. 
D) Demand increases due to a competitor increasing its prices. 
E) Demand increases due to an increase in consumer incomes.

Question 8

Describe a profit objective used by many Japanese manufacturing firms.

Accepted Answer

Managing for long-run profits is a prici

Question 9

Which of the following is a typical example of a variable cost?

Accepted Answer

A) shipping costs 
B) rent on a building 
C) executive salaries 
D) insurance premiums 
E) leases on delivery trucks 
A) shipping costs 
B) rent on a building 
C) executive salaries 
D) insurance premiums 
E) leases on delivery trucks

Question 10

Which of the following statements about the factors that influence demand is true?

Accepted Answer

A) As the availability of close substitutes increases,the demand for a product increases. 
B) As real consumer income increases,the demand for a product increases. 
C) As the price of close substitutes increases,the demand for a product declines. 
D) Changing consumer tastes have little impact on the demand for a product. 
E) As real consumer income decreases,the demand for a product increases. 
A) As the availability of close substitutes increases,the demand for a product increases. 
B) As real consumer income increases,the demand for a product increases. 
C) As the price of close substitutes increases,the demand for a product declines. 
D) Changing consumer tastes have little impact on the demand for a product. 
E) As real consumer income decreases,the demand for a product increases.

Question 11

The owner of a small restaurant that sells takeout fried chicken and biscuits each month pays $2,500 in rent,$500 in utilities,$750 interest on his loan,insurance premium of $200,and $250 on advertising on local buses.A bucket of chicken is priced at $9.50.Unit variable costs for the bucket of chicken are $5.50.How many buckets of chicken does the restaurant need to sell to break even each month?

Accepted Answer

A) 442 buckets 
B) 764 buckets 
C) 1,050 buckets 
D) 3,150 buckets 
E) 4,200 buckets 
A) 442 buckets 
B) 764 buckets 
C) 1,050 buckets 
D) 3,150 buckets 
E) 4,200 buckets

Question 12

If a firm finds the demand for one of its products is inelastic,it can increase its total revenues by

Accepted Answer

A) lowering its price. 
B) increasing fixed costs only. 
C) increasing variable costs only. 
D) increasing both fixed and variable costs. 
E) raising its price. 
A) lowering its price. 
B) increasing fixed costs only. 
C) increasing variable costs only. 
D) increasing both fixed and variable costs. 
E) raising its price.

Question 13

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) We're going to face some aggressive competition. 
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) We're going to face some aggressive competition.

Question 14

For the sake of simplicity and by convention,price elasticity figures are shown as

Accepted Answer

A) positive numbers (0.64,1.25,etc. ). 
B) negative numbers (−0.64,−1.25,etc. ). 
C) Greek letters (∑,∏,etc. ). 
D) Roman numerals (I,V,X,etc. ). 
E) English consonants (P,Q,TR,etc. ). 
A) positive numbers (0.64,1.25,etc. ). 
B) negative numbers (−0.64,−1.25,etc. ). 
C) Greek letters (∑,∏,etc. ). 
D) Roman numerals (I,V,X,etc. ). 
E) English consonants (P,Q,TR,etc. ).

Question 15

Washburn Guitars recently purchased Parker Guitar,another guitar manufacturer that designs products for professionals and collectors,and will combine the two production facilities into a new location.Washburn expects the acquisition to reduce its rent and tax expenses by 40 percent,and the new skilled employees will reduce the hours of work needed for each unit by 15 percent.This would cause the slope of the total cost curve to ________ and the break-even quantity to

Accepted Answer

A) decrease;stay the same. 
B) decrease;increase. 
C) increase;increase. 
D) stay the same;increase. 
E) decrease;decrease. 
A) decrease;stay the same. 
B) decrease;increase. 
C) increase;increase. 
D) stay the same;increase. 
E) decrease;decrease.

Question 16

The practice of exchanging products and services for other products and services rather than for money is referred to as

Accepted Answer

A) barter. 
B) reciprocal pricing. 
C) virtual pricing. 
D) balance of payments. 
E) value-pricing. 
A) barter. 
B) reciprocal pricing. 
C) virtual pricing. 
D) balance of payments. 
E) value-pricing.

Question 17

Forever Quilting makes quilting kits priced at $120.The costs of the materials that go into each kit total $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,and $4,500 for the monthly salary of its owner.Forever Quilting's unit variable cost for its kits is

Accepted Answer

A) $5. 
B) $45. 
C) $50. 
D) $120. 
E) $170. 
A) $5. 
B) $45. 
C) $50. 
D) $120. 
E) $170.

Question 18

According to the price equation,final price equals ________ minus incentives and allowances plus extra fees.

Accepted Answer

A) salaries 
B) list price 
C) profits 
D) trade-ins 
E) taxes 
A) salaries 
B) list price 
C) profits 
D) trade-ins 
E) taxes

Question 19

Figure 13-3
  
-In Figure 13-3 above,column A 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 20

Competitors' prices are important only if a prospective buyer knows about those prices and

Accepted Answer

A) can act to purchase them easily. 
B) there is an oligopoly in the industry. 
C) is part of a price-sensitive market segment. 
D) the product is at the maturity stage of the product life cycle. 
E) is likely to spread information via word of mouth. 
A) can act to purchase them easily. 
B) there is an oligopoly in the industry. 
C) is part of a price-sensitive market segment. 
D) the product is at the maturity stage of the product life cycle. 
E) is likely to spread information via word of mouth.

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

Which of the following statements regarding a market share pricing objective is most accurate?

Total cost refers to

Which of the following statements is most accurate?

A reference value is developed by the consumer through

Which of the following illustrates movement along the demand curve?

Describe a profit objective used by many Japanese manufacturing firms.

Which of the following is a typical example of a variable cost?

Which of the following statements about the factors that influence demand is true?

If a firm finds the demand for one of its products is inelastic,it can increase its total revenues by

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

For the sake of simplicity and by convention,price elasticity figures are shown as

The practice of exchanging products and services for other products and services rather than for money is referred to as

According to the price equation,final price equals ________ minus incentives and allowances plus extra fees.

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

Competitors' prices are important only if a prospective buyer knows about those prices and

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

Filters

Exam 13: Building the Price Foundation

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

Which of the following statements regarding a market share pricing objective is most accurate?

Total cost refers to

Which of the following statements is most accurate?

A reference value is developed by the consumer through

Which of the following illustrates movement along the demand curve?

Describe a profit objective used by many Japanese manufacturing firms.

Which of the following is a typical example of a variable cost?

Which of the following statements about the factors that influence demand is true?

If a firm finds the demand for one of its products is inelastic,it can increase its total revenues by

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

For the sake of simplicity and by convention,price elasticity figures are shown as

The practice of exchanging products and services for other products and services rather than for money is referred to as

According to the price equation,final price equals ________ minus incentives and allowances plus extra fees.

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

Competitors' prices are important only if a prospective buyer knows about those prices and

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

Filters