Exam 11: Pricing Concepts and Strategies: Establishing Value

A company manufactures tires that are sold to retailers as well as automobile companies.What kind of pricing tactics is likely to be advantageous for different customers?

Ochre Inc.had marked its refrigerators at $729.94 as the original price.This was close to the standard price for refrigerators of the same quality in the market.Later, the price is brought down to $650.99.A customer compares Ochre's marked-down price with the original price and perceives an increased value.This is an example of:

Explain the concept of price skimming.In what markets price skimming is recommended?

A store advertises a pair of shoes at $79.99 with a cash-back offer of $20.The refund is made by the manufacturer.This is an example of a:

Mike wants to set up a factory to manufacture roller skates.He plans to employ a hundred people in his factory.Mike's primary expenses include rent, utilities, insurance, administrative salaries (for executives and higher-level managers), and depreciation of the physical plant and equipment.The expenses for raw material and labour to make the skates constitute the:

Those products for which changes in demand are negatively related are called:

A furniture manufacturing company in Canada delivers goods to its customers in Europe.The shipping company that delivers the goods to customers charges the same irrespective of the country in which the customer is located.This is an example of:

Telecommunication industry in Canada is controlled by handful companies, therefore, the competition is:

A car company introduces a new car in the market.It maintains a low introductory price to reach the middle-income group.The main objective of the company is to build sales and profits quickly.This is an example of:

It is illegal to charge a different price to a reseller if the firm is attempting to meet a specific competitor's price.

Explain the difference between predatory pricing and price discrimination.Provide one example for each.

Differentiate between an elastic and an inelastic market.Provide one example for each market.

The change in the quantity of a product demanded by consumers because of a change in their earnings is called the:

Which of the following pricing strategies sets the initial price low for the introduction of a new product or service, with the objective of building sales, market share, and profits quickly?

A company advertises that winter pullovers and jackets will be sold at half price if they are ordered before September 30.This is an example of a(n):

Break-even analysis for Joe's store -What would be the fixed cost of Joe's store?

Which of the following would a shipping company adopt in order to set a price that would charge its customers based on the actual distance?

Which of the following is NOT true of the break-even point?

Differentiate between horizontal price fixing and vertical price fixing.Provide one example for each.

A vegetable farm supplies vegetables to a supermarket in Pemberton.The vegetable vendor and the supermarket work together to control the prices passed on to consumers.This is an example of: