Question 1

A marketer uses only one pricing objective to avoid organizational confusion.

Accepted Answer

A) True 
 B)False  False

Question 2

Differential pricing means different buyers pay different prices for the same quality and quantity of product.

Accepted Answer

A) True 
 B)False  True

Question 3

Iota Designs thinks its new product, the Automatic Dog Walker, will have a short product life cycle; therefore, its marketing department sets its primary pricing objective as

Accepted Answer

A) market share. 
B) cash flow. 
C) profit. 
D) product quality. 
E) status quo. 
A) market share. 
B) cash flow. 
C) profit. 
D) product quality. 
E) status quo. B

Question 4

Competition-based pricing is

Accepted Answer

A) used when costs and revenues are secondary to competitors' prices. 
B) not useful as a method of increasing market share. 
C) not useful if the competing products are homogeneous. 
D) not able to increase sales. 
E) used when competing products are heterogeneous. 
A) used when costs and revenues are secondary to competitors' prices. 
B) not useful as a method of increasing market share. 
C) not useful if the competing products are homogeneous. 
D) not able to increase sales. 
E) used when competing products are heterogeneous.

Question 5

Marketers at organizations engaged in nonprice competition

Accepted Answer

A) are more concerned about knowing competitors' prices than are marketers in organizations that are engaged in price competition. 
B) are not concerned about the prices of competing brands. 
C) need competitive price information to make sure that their products are priced at approximately the same level as the prices of competing brands. 
D) rely on customers to help them gather information regarding the prices of competing brands. 
E) experience high levels of price instability. 
A) are more concerned about knowing competitors' prices than are marketers in organizations that are engaged in price competition. 
B) are not concerned about the prices of competing brands. 
C) need competitive price information to make sure that their products are priced at approximately the same level as the prices of competing brands. 
D) rely on customers to help them gather information regarding the prices of competing brands. 
E) experience high levels of price instability.

Question 6

When determining the markup, it is important to know whether it is based on cost or selling price.

Accepted Answer

A) True 
 B)False

Question 7

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 8

If Wilson Sporting Goods faces a standard demand curve that exists for most products, as it raises the price of its tennis rackets, the

Accepted Answer

A) quantity demanded goes down. 
B) demand remains constant. 
C) quantity demanded increases. 
D) demand increases. 
E) breakeven increases. 
A) quantity demanded goes down. 
B) demand remains constant. 
C) quantity demanded increases. 
D) demand increases. 
E) breakeven increases.

Question 9

Explain differential pricing and then describe the four major types.

Accepted Answer

Differential pricing means charging diff

Question 10

A psychological price is designed to encourage purchases on the basis of rational response rather than on the basis of emotional reactions.

Accepted Answer

A) True 
 B)False

Question 11

What type of pricing objective would an organization use if it were in a favorable position and desired nothing more?

Accepted Answer

A) Return on investment 
B) Cash flow 
C) Profit 
D) Status quo 
E) Survival 
A) Return on investment 
B) Cash flow 
C) Profit 
D) Status quo 
E) Survival

Question 12

If Dell uses _____ pricing for its newest version of laptops, it is probably most interested in obtaining market share; and it is assuming

Accepted Answer

A) premium pricing; that no other competitors are likely to enter the market soon. 
B) price-skimming; that no other competitors are likely to enter the market soon. 
C) premium pricing; it needs to recoup R & D costs as soon as possible. 
D) penetration pricing; that no other competitors are likely to enter the market soon. 
E) penetration pricing; that other competitors could enter the market easily. 
A) premium pricing; that no other competitors are likely to enter the market soon. 
B) price-skimming; that no other competitors are likely to enter the market soon. 
C) premium pricing; it needs to recoup R & D costs as soon as possible. 
D) penetration pricing; that no other competitors are likely to enter the market soon. 
E) penetration pricing; that other competitors could enter the market easily.

Question 13

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

Accepted Answer

A) True 
 B)False

Question 14

Explain the difference between cost-plus and markup pricing.

Accepted Answer

With cost-plus pricing, the seller's cos

Question 15

The fact that senior citizens are charged a lower price at movie theaters than younger adults is an example of ____ pricing.

Accepted Answer

A) price-line 
B) promotional 
C) professional 
D) differential 
E) psychological 
A) price-line 
B) promotional 
C) professional 
D) differential 
E) psychological

Question 16

F.O.B. factory denotes the price of the products at the factory. If the price is quoted as F.O.B. shipping, then shipping costs are paid by the seller.

Accepted Answer

A) True 
 B)False

Question 17

Myra's company just purchased $600 worth of supplies from Office Depot. The terms for payment are 2/10 net 30. If Myra's firm pays in the next week, it will pay ___________. If Myra's company waits three weeks to pay Office Depot, it will pay _____________.

Accepted Answer

A) $600; $630 
B) $588; $600 
C) $540; $588 
D) $540; $600 
E) $588; $630 
A) $600; $630 
B) $588; $600 
C) $540; $588 
D) $540; $600 
E) $588; $630

Question 18

When establishing prices, a marketer's first step is to

Accepted Answer

A) determine demand. 
B) develop pricing objectives. 
C) select a pricing policy. 
D) evaluate competitors' prices. 
E) determine a pricing method. 
A) determine demand. 
B) develop pricing objectives. 
C) select a pricing policy. 
D) evaluate competitors' prices. 
E) determine a pricing method.

Question 19

Wendy's restaurants have experienced declining sales recently due to consumers' increased interest in healthier eating and their preference for fast-casual restaurants such as Chipotle and Modern Market. In order to attract more customers to Wendy's, the chain expanded the number of items they are offering on the $1 menu, and many of these items are priced below cost. Wendy's is most likely utilizing a _____ pricing objective.

Accepted Answer

A) survival 
B) profit 
C) market share 
D) return on investment 
A) survival 
B) profit 
C) market share 
D) return on investment

Question 20

Zoey is setting a price for her store's newest item. She purchased the item for $45 and decides to sell it for $54 using markup pricing. If she wanted to calculate the markup as percentage of cost, it would be ______________. If she wanted to calculate the markup as the percentage of the selling price, it would be ______________.

Accepted Answer

A) 16.7%; 12% 
B) 33%; 25% 
C) 12.5%; 15.6% 
D) 12%; 16.7% 
E) 15%; 10.5% 
A) 16.7%; 12% 
B) 33%; 25% 
C) 12.5%; 15.6% 
D) 12%; 16.7% 
E) 15%; 10.5%

A marketer uses only one pricing objective to avoid organizational confusion.

Differential pricing means different buyers pay different prices for the same quality and quantity of product.

Iota Designs thinks its new product, the Automatic Dog Walker, will have a short product life cycle; therefore, its marketing department sets its primary pricing objective as

Competition-based pricing is

Marketers at organizations engaged in nonprice competition

When determining the markup, it is important to know whether it is based on cost or selling price.

At the breakeven point,

If Wilson Sporting Goods faces a standard demand curve that exists for most products, as it raises the price of its tennis rackets, the

Explain differential pricing and then describe the four major types.

A psychological price is designed to encourage purchases on the basis of rational response rather than on the basis of emotional reactions.

What type of pricing objective would an organization use if it were in a favorable position and desired nothing more?

If Dell uses _____ pricing for its newest version of laptops, it is probably most interested in obtaining market share; and it is assuming

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

Explain the difference between cost-plus and markup pricing.

The fact that senior citizens are charged a lower price at movie theaters than younger adults is an example of ____ pricing.

F.O.B. factory denotes the price of the products at the factory. If the price is quoted as F.O.B. shipping, then shipping costs are paid by the seller.

Myra's company just purchased $600 worth of supplies from Office Depot. The terms for payment are 2/10 net 30. If Myra's firm pays in the next week, it will pay _. If Myra's company waits three weeks to pay Office Depot, it will pay ___.

When establishing prices, a marketer's first step is to

Customer-Driven Strategic Marketing

Planning, Implementing, and Evaluating 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

Digital Marketing and Social Networking

Product, Branding, and Packaging Concepts

Developing and Managing Goods and Services

Marketing Channels and Supply-Chain Management

Retailing, Direct Marketing, and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Filters

Exam 12: Pricing Concepts and Management

A marketer uses only one pricing objective to avoid organizational confusion.

Differential pricing means different buyers pay different prices for the same quality and quantity of product.

Iota Designs thinks its new product, the Automatic Dog Walker, will have a short product life cycle; therefore, its marketing department sets its primary pricing objective as

Competition-based pricing is

Marketers at organizations engaged in nonprice competition

When determining the markup, it is important to know whether it is based on cost or selling price.

At the breakeven point,

If Wilson Sporting Goods faces a standard demand curve that exists for most products, as it raises the price of its tennis rackets, the

Explain differential pricing and then describe the four major types.

A psychological price is designed to encourage purchases on the basis of rational response rather than on the basis of emotional reactions.

What type of pricing objective would an organization use if it were in a favorable position and desired nothing more?

If Dell uses _____ pricing for its newest version of laptops, it is probably most interested in obtaining market share; and it is assuming

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

Explain the difference between cost-plus and markup pricing.

The fact that senior citizens are charged a lower price at movie theaters than younger adults is an example of ____ pricing.

F.O.B. factory denotes the price of the products at the factory. If the price is quoted as F.O.B. shipping, then shipping costs are paid by the seller.

Myra's company just purchased $600 worth of supplies from Office Depot. The terms for payment are 2/10 net 30. If Myra's firm pays in the next week, it will pay ___________. If Myra's company waits three weeks to pay Office Depot, it will pay _____________.

When establishing prices, a marketer's first step is to

Customer-Driven Strategic Marketing

Planning, Implementing, and Evaluating 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

Digital Marketing and Social Networking

Product, Branding, and Packaging Concepts

Developing and Managing Goods and Services

Marketing Channels and Supply-Chain Management

Retailing, Direct Marketing, and Wholesaling

Integrated Marketing Communications

Advertising and Public Relations

Personal Selling and Sales Promotion

Filters

Myra's company just purchased $600 worth of supplies from Office Depot. The terms for payment are 2/10 net 30. If Myra's firm pays in the next week, it will pay _. If Myra's company waits three weeks to pay Office Depot, it will pay ___.