Exam 12: Pricing Concepts and Management

A price-leader approach is a pricing approach most often used in supermarkets to attract consumers by giving them special low prices on a few items.

Caroline is selling soda and lemonade at the local university's baseball game. She prices the soda at $4.00 a bottle and lemonade at $7 each. These are generally much higher prices than people would normally pay. What is likely to happen to demand?

If the product price is $100, average variable cost $40 per unit, and the total fixed costs are $120,000, what is the breakeven point?

If REVO offers 20% off on Black Friday every year for its sunglasses, it is using _____.

You are the marketing manager for a multistate auto dealership in the southeast United States. It is that time of year when your fleet of autos goes through a major model year change. You are putting the final touches on your pricing strategy to facilitate this change in your inventory of autos. ​ Which of the following pricing strategies will you use to facilitate this model year change?

A Macy's manager designs the casual clothing department such that one of Macy's private label pairs of jeans, priced at $24.99, is positioned next to a national brand of jeans, such as Levis, priced at $39.99. What is the manager attempting to accomplish?

For most products, a(n) ____ relationship exists between the price of a particular product and the quantity demanded.

The decision of Sears to use odd prices such as $59.99 for a Craftsman drill is an application of ____, where prices are often used to _____.

Price elasticity of demand measures the sensitivity of demand to changes in price.

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.

____________ are reductions off the list price given by a producer to an intermediary for performing certain functions.

Running a big sale in order to generate enough cash flow to pay creditors is typical in a situation in which a firm's primary pricing objective is

When a seller's costs are usually determined during or after a product is made and then a specified percentage or dollar amount is added to the cost to establish a price, an organization is using ____ pricing.

Which of the following bases for pricing is most commonly used by retailers?

Cost-plus pricing is popular in periods of rapid inflation.

If Princess Cruise Lines increased the price of its seven-day cruise package by 10% and, as a result, experienced a 20% decline in customer bookings, Princess's demand would be

Comparison of various prices and various breakeven points will tell the marketer exactly what price to charge.

A graph of the quantity of products marketers expect to sell at various prices if other factors remain constant is a

Markup pricing is not used often by marketers because establishing a percentage markup greatly increases the complexity of the decision-making process.

One pitfall of cost-plus pricing for the buyer is that the seller may increase costs to establish a larger profit base.