Question 1

Demand depends only on the price of the product.

Accepted Answer

A) True 
 B)False

Question 2

Price is a crucial marketing mix component.

Accepted Answer

A) True 
 B)False

Question 3

A certain location of O'Charley's Restaurant has annual fixed costs of $200,000. If an average tab at the restaurant is $60 and the variable costs per tab is $20, how many groups of customers must O'Charley's serve per year in order to break even?

Accepted Answer

A) 2,000 
B) 5,000 
C) 10,000 
D) 3,333 
E) 2,500 
A) 2,000 
B) 5,000 
C) 10,000 
D) 3,333 
E) 2,500

Question 4

Scenario 12.1
Use the following to answer the questions.
Concession Supply sells hotdogs, buns, and nacho ingredients to several major league ballparks across the country. Currently, Concession Supply has the following pricing information for one case of hotdogs sold at Wrigley Field: Total fixed costs = $1,200, Selling price = $16, and Variable costs = $6.
-Refer to Scenario 12.1. What is the breakeven point in dollar sales volume?

Accepted Answer

A) $1,200 
B) $1,440 
C) $3,000 
D) $1,920 
E) $1,600 
A) $1,200 
B) $1,440 
C) $3,000 
D) $1,920 
E) $1,600

Question 5

Marginal analysis involves examining

Accepted Answer

A) what happens to a firm's costs and revenues when production is changed by one unit. 
B) the extra revenue produced by the sale of one more product. 
C) the extra cost incurred by the production of one more unit. 
D) the difference between marginal revenue and total revenue. 
E) the difference between marginal cost and total cost. 
A) what happens to a firm's costs and revenues when production is changed by one unit. 
B) the extra revenue produced by the sale of one more product. 
C) the extra cost incurred by the production of one more unit. 
D) the difference between marginal revenue and total revenue. 
E) the difference between marginal cost and total cost.

Question 6

Temporary price reductions through sales, rebates, and special discounts are often used to

Accepted Answer

A) raise cash quickly. 
B) decrease costs. 
C) increase profitability. 
D) run off the competition. 
E) create a value image. 
A) raise cash quickly. 
B) decrease costs. 
C) increase profitability. 
D) run off the competition. 
E) create a value image.

Question 7

Rent is usually a fixed cost.

Accepted Answer

A) True 
 B)False

Question 8

If demand is elastic, a change in price causes a parallel change in total revenue.

Accepted Answer

A) True 
 B)False

Question 9

Knowing the target market's evaluation of price allows the marketer to know how much emphasis to place on price and how to price a product relative to competition.

Accepted Answer

A) True 
 B)False

Question 10

If a firm currently produces 2,500 products per month and decides to produce 2,501, it will incur

Accepted Answer

A) more fixed costs. 
B) higher average fixed costs. 
C) fewer variable costs. 
D) a marginal cost. 
E) higher average variable costs. 
A) more fixed costs. 
B) higher average fixed costs. 
C) fewer variable costs. 
D) a marginal cost. 
E) higher average variable costs.

Question 11

When marketers at Consolidated Mustard Company tried to determine demand for their product, they found that at 50 cents, consumers wanted 2,000 jars; at $1.00, they wanted 6,000 jars; and at $1.50, they wanted 4,000 jars. What can Consolidated conclude?

Accepted Answer

A) Consolidated did poor market demand research. 
B) Consolidated has an elastic product. 
C) Consolidated has an inelastic product. 
D) Consolidated mustard is a prestige good. 
E) Consolidated mustard has a normal demand curve. 
A) Consolidated did poor market demand research. 
B) Consolidated has an elastic product. 
C) Consolidated has an inelastic product. 
D) Consolidated mustard is a prestige good. 
E) Consolidated mustard has a normal demand curve.

Question 12

The Highland Racquet Club found that with annual fixed costs of $60,000, its breakeven point is 2,000 members when the membership charge is $60 per person per year. What is the variable cost per person for Highland?

Accepted Answer

A) $45 
B) $50 
C) $30 
D) $25 
E) $40 
A) $45 
B) $50 
C) $30 
D) $25 
E) $40

Question 13

At the breakeven point,

Accepted Answer

A) the money a company brings in from selling products equals the amount spent producing the products. 
B) the total fixed costs are exactly equal to the total variable costs. 
C) profits are exactly equal to the difference between revenue and total variable costs. 
D) the marginal revenue of a product is exactly equal to the marginal cost of producing one more unit. 
E) the marginal cost curve and the average cost curve will be identical for a particular product. 
A) the money a company brings in from selling products equals the amount spent producing the products. 
B) the total fixed costs are exactly equal to the total variable costs. 
C) profits are exactly equal to the difference between revenue and total variable costs. 
D) the marginal revenue of a product is exactly equal to the marginal cost of producing one more unit. 
E) the marginal cost curve and the average cost curve will be identical for a particular product.

Question 14

In setting price, it is wise to analyze competitors' prices.

Accepted Answer

A) True 
 B)False

Question 15

The point at which the costs of producing a product equal the revenue earned from selling the product is

Accepted Answer

A) elasticity of demand. 
B) the breakeven point. 
C) variable costs. 
D) price elasticity. 
E) the sum of fixed and variable costs. 
A) elasticity of demand. 
B) the breakeven point. 
C) variable costs. 
D) price elasticity. 
E) the sum of fixed and variable costs.

Question 16

The major disadvantage of using price competition is that it takes a long time to implement the changes in price.

Accepted Answer

A) True 
 B)False

Question 17

For most firms in the United States, demand curves are

Accepted Answer

A) upward sloping. 
B) completely horizontal. 
C) completely vertical. 
D) c-shaped. 
E) downward sloping. 
A) upward sloping. 
B) completely horizontal. 
C) completely vertical. 
D) c-shaped. 
E) downward sloping.

Question 18

If a retailer orders a quantity of merchandise to be delivered to his store in Phoenix and is quoted a price that does not include shipping charges, the retailer is paying a(n) ____ price.

Accepted Answer

A) F.O.B. destination 
B) F.O.B. factory 
C) transfer 
D) postage-stamp 
E) base-point 
A) F.O.B. destination 
B) F.O.B. factory 
C) transfer 
D) postage-stamp 
E) base-point

Question 19

Marketers should set prices consistent with marketing goals, not with the corporate mission.

Accepted Answer

A) True 
 B)False

Question 20

Lucy buys a new dress at T.J. Maxx that has a price tag with "Compare at $50.00. Our Price $29.99." This is an example of the use of

Accepted Answer

A) internal referencing. 
B) cumulative discounts. 
C) seasonal discounts. 
D) base-point pricing. 
E) an external reference price. 
A) internal referencing. 
B) cumulative discounts. 
C) seasonal discounts. 
D) base-point pricing. 
E) an external reference price.

Demand depends only on the price of the product.

Price is a crucial marketing mix component.

A certain location of O'Charley's Restaurant has annual fixed costs of $200,000. If an average tab at the restaurant is $60 and the variable costs per tab is $20, how many groups of customers must O'Charley's serve per year in order to break even?

Marginal analysis involves examining

Temporary price reductions through sales, rebates, and special discounts are often used to

Rent is usually a fixed cost.

If demand is elastic, a change in price causes a parallel change in total revenue.

Knowing the target market's evaluation of price allows the marketer to know how much emphasis to place on price and how to price a product relative to competition.

If a firm currently produces 2,500 products per month and decides to produce 2,501, it will incur

When marketers at Consolidated Mustard Company tried to determine demand for their product, they found that at 50 cents, consumers wanted 2,000 jars; at $1.00, they wanted 6,000 jars; and at $1.50, they wanted 4,000 jars. What can Consolidated conclude?

The Highland Racquet Club found that with annual fixed costs of $60,000, its breakeven point is 2,000 members when the membership charge is $60 per person per year. What is the variable cost per person for Highland?

At the breakeven point,

In setting price, it is wise to analyze competitors' prices.

The point at which the costs of producing a product equal the revenue earned from selling the product is

The major disadvantage of using price competition is that it takes a long time to implement the changes in price.

For most firms in the United States, demand curves are

If a retailer orders a quantity of merchandise to be delivered to his store in Phoenix and is quoted a price that does not include shipping charges, the retailer is paying a(n) ____ price.

Marketers should set prices consistent with marketing goals, not with the corporate mission.

Lucy buys a new dress at T.J. Maxx that has a price tag with "Compare at $50.00. Our Price $29.99." This is an example of the use of

Customer-Driven Strategic Marketing

Planning Marketing Strategies

The Marketing Environment, Social Responsibility, and Ethics

Marketing Research and Information Systems

Target Market Segmentation and Evaluation

Consumer Buying Behavior

Business Markets and Buying Behavior

Reaching Global Markets

E-Marketing, Digital Media, and Social Networking

Product, Branding, and Packaging Concepts

Developing and Managing Goods and Services

Pricing Management

A:marketing Channels and Supply-Chain Management

B:marketing Channels and Supply-Chain Management

A:retailing, Direct Marketing, and Wholesaling

B:retailing, Direct Marketing, and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Filters

Exam 12: Pricing Concepts

Demand depends only on the price of the product.

Price is a crucial marketing mix component.

A certain location of O'Charley's Restaurant has annual fixed costs of $200,000. If an average tab at the restaurant is $60 and the variable costs per tab is $20, how many groups of customers must O'Charley's serve per year in order to break even?

Marginal analysis involves examining

Temporary price reductions through sales, rebates, and special discounts are often used to

Rent is usually a fixed cost.

If demand is elastic, a change in price causes a parallel change in total revenue.

Knowing the target market's evaluation of price allows the marketer to know how much emphasis to place on price and how to price a product relative to competition.

If a firm currently produces 2,500 products per month and decides to produce 2,501, it will incur

When marketers at Consolidated Mustard Company tried to determine demand for their product, they found that at 50 cents, consumers wanted 2,000 jars; at $1.00, they wanted 6,000 jars; and at $1.50, they wanted 4,000 jars. What can Consolidated conclude?

The Highland Racquet Club found that with annual fixed costs of $60,000, its breakeven point is 2,000 members when the membership charge is $60 per person per year. What is the variable cost per person for Highland?

At the breakeven point,

In setting price, it is wise to analyze competitors' prices.

The point at which the costs of producing a product equal the revenue earned from selling the product is

The major disadvantage of using price competition is that it takes a long time to implement the changes in price.

For most firms in the United States, demand curves are

If a retailer orders a quantity of merchandise to be delivered to his store in Phoenix and is quoted a price that does not include shipping charges, the retailer is paying a(n) ____ price.

Marketers should set prices consistent with marketing goals, not with the corporate mission.

Lucy buys a new dress at T.J. Maxx that has a price tag with "Compare at $50.00. Our Price $29.99." This is an example of the use of

Customer-Driven Strategic Marketing

Planning Marketing Strategies

The Marketing Environment, Social Responsibility, and Ethics

Marketing Research and Information Systems

Target Market Segmentation and Evaluation

Consumer Buying Behavior

Business Markets and Buying Behavior

Reaching Global Markets

E-Marketing, Digital Media, and Social Networking

Product, Branding, and Packaging Concepts

Developing and Managing Goods and Services

Pricing Management

A:marketing Channels and Supply-Chain Management

B:marketing Channels and Supply-Chain Management

A:retailing, Direct Marketing, and Wholesaling

B:retailing, Direct Marketing, and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Filters