Exam 10: Pricing: Understanding and Capturing Customer Value

When McDonald's and other fast food restaurants offer "value menu" items at surprisingly low prices, they are most likely using ________ pricing.

Product costs set the ceiling for prices.

Which of the following processes does value-based pricing reverse?

Overhead costs ________ as the number of units produced increases.

As a manufacturer increases the price, ________.

Azure Air, an airline company, offers attractive prices to customers with tighter budgets. A no-frills airline, it charges for all other additional services, such as baggage handling and in-flight refreshments. Which of the following best describes Azure Air's pricing method?

Which of the following is true with regard to pure competition?

A break-even chart shows the total cost and total revenue expected at various sales volume levels.

Price decisions must be coordinated with product design, distribution, and promotion decisions to form a consistent and effective integrated marketing mix program.

List some important characteristics of price.

Companies with higher costs ________.

Bruno Servers has decided to decrease its prices on its popular higher-range servers. The company can reasonably expect ________ to increase.

Distinguish between value-based pricing and cost-based pricing.

Factors a company considers in setting its price include all of the following EXCEPT ________.

Which of the following involves introducing less-expensive versions of established, brand name products?

Target return pricing uses the concept of a(n) ________, which shows the total cost and total revenue expected at different sales volume levels.

Under ________, the market consists of many buyers and sellers trading in a uniform commodity.

A cell phone manufacturing firm produced 1,000 cell phones a day but believed that it could reasonably step up production to 2,000 cell phones a day. Consequently, it built a larger plant and installed efficient machinery and work arrangements to realize the projected output. Which of the following can most likely be inferred from this information?

Department stores that practice everyday low pricing typically provide frequent sale days, early-bird savings, and bonus earnings for store credit-card holders.

Explain the concept of the price ceiling.