Exam 18: Pricing Concepts

When the NES Group lowered the price of its professional-grade meat slicers from $2,300 to $1,600,demand doubled from 4 units sold per month to 8 units per month.However,total revenue dropped.What is this an example of?

Bill Needles makes and sells customized silver belt buckles for $225 each.He has determined that his fixed costs are $8,000,and his average variable costs per buckle are $145. -Refer to Bill Needles.What is his break-even point in units?

The American Girl catalogue began as a concept to introduce today's girls to girls who lived in the past.Each historically accurate doll is carefully crafted and dressed and has books to describe her life.For example,Kristen is an 1854 pioneer girl who is growing up in Minnesota.Her story begins with her long sea voyage from Sweden.The basic doll dressed in a calico dress and striped apron plus the hardcover story of how she got to Minnesota costs $90.Six more hardback books of Kristen's life are available for $74.95.Kristen's nightgown costs $20,and a matching one for the doll owner is an additional $38.Buy both together and the price is only $50.A hand-painted wooden bed and trunk for Kristen are available for $213.Shipping costs vary with the price of the merchandise ordered. -Refer to American Girl Doll.What is the revenue to American Girl if it sells 20 basic Kristen doll and books?

In the mid-1990s,Continental Airlines in the United States chose to compete head-on with Southwest Airlines by launching Continental Lite,an alternative low-fare commercial airline passenger operation.Top executives at Continental had expected its no-frills operation to break even within a year of its inception,but the airline fell short of the goal.A source close to the company explained it by saying,"Its costs were too high,and its revenues were too low." Some observers criticized Continental's marketing efforts.When the no-frills service was first launched,it lacked a distinct name or identity,missing its chance to make a splash.Then Continental tried to sell three "brands" at once-Lite,a new premium service,and its more traditional long-haul domestic flights.As one rival expressed it,"You cannot be all things to all people." -Refer to Continental Lite.The statement that Continental Lite had problems because "Its costs were too high,and its revenues were too low," after paying for airline activities it suggests that the airline had none of which of the following left over?

Which type of pricing objective does a company using market share pricing have?

Pierre's Ice Cream Company produces ultra-rich ice cream.Last year,it managed to exceed its target ROI for the current fiscal year.The following results were found on its financial statements: What was the actual return on investment (ROI)for Parrish Farms?

Shopping bots do which of the following?

At a price of $6 each,314 people want to buy sun visors designed especially for volunteers at the Nike run,and only 314 such visors are available.In this example,which type of state has been achieved?

What is the quantity of a product that people will buy/demand most dependent on?

Imagine you're planning an after-symphony fundraising party,and you need a life-size grand piano cake.Or,you are a developer proposing a new shopping centre to a group of investors,and you want to serve a cake shaped like an architectural rendition of the centre.Is this impossible? No,you just need to contact Cecilia Villaveces Cakes.She actually built a life-size grand piano for a major gala.You can expect to pay anywhere from $75 to $10,000 for one of Cecilia's artistic creations,depending on complexity of design and size.She uses only the best ingredients,and no two cakes are ever quite alike. -Refer to Specialty Cakes.Which of the following is the best example of a variable cost for Cecilia Villaveces Cakes?

List the three categories of pricing objectives and then two specific strategies in each category that a marketer could implement to achieve those objectives.

What is the biggest advantage associated with markup pricing?

What occurs when consumers are sensitive to price changes?

For about a year,AMD representatives have told journalists that they do not believe that AMD will have to react in any way to the launch of Intel's Quad-Core processor.But just a week before Intel's introduction of this product,AMD reduced the price of its desktop processors by 47 percent.What is AMD hoping that demand for its processors will be?

What are yield management systems? In what type of industry were they first used?

In the mid-1990s,Continental Airlines in the United States chose to compete head-on with Southwest Airlines by launching Continental Lite,an alternative low-fare commercial airline passenger operation.Top executives at Continental had expected its no-frills operation to break even within a year of its inception,but the airline fell short of the goal.A source close to the company explained it by saying,"Its costs were too high,and its revenues were too low." Some observers criticized Continental's marketing efforts.When the no-frills service was first launched,it lacked a distinct name or identity,missing its chance to make a splash.Then Continental tried to sell three "brands" at once-Lite,a new premium service,and its more traditional long-haul domestic flights.As one rival expressed it,"You cannot be all things to all people." -Refer to Continental Lite.Consumers who travelled on Continental Lite or Southwest were very sensitive to price changes.This suggests which of the following?

Which of the following statements about pricing strategies throughout the product life cycle is NOT true?

In the mid-1990s,Continental Airlines in the United States chose to compete head-on with Southwest Airlines by launching Continental Lite,an alternative low-fare commercial airline passenger operation.Top executives at Continental had expected its no-frills operation to break even within a year of its inception,but the airline fell short of the goal.A source close to the company explained it by saying,"Its costs were too high,and its revenues were too low." Some observers criticized Continental's marketing efforts.When the no-frills service was first launched,it lacked a distinct name or identity,missing its chance to make a splash.Then Continental tried to sell three "brands" at once-Lite,a new premium service,and its more traditional long-haul domestic flights.As one rival expressed it,"You cannot be all things to all people." -Refer to Continental Lite.The airline industry's demand curve slopes downward and to the right.This curve indicates the quantity demanded is increased as which of the following occurs?

Kenady Appliances pays a manufacturer $800 for a convection oven,and it sells the convection oven to a customer for $1,600.What is the markup on the screen?

The point at which marginal cost and marginal revenue are equal always results in which of the following?