Exam 16: Pricing Concepts and Strategies

Which of the following methods uses a base-cost figure per unit and adds a markup to cover unassigned costs and to provide a profit?

The basis on which most price structures are built is the list price-the rate normally quoted to potential buyers.

What is penetration pricing sometimes referred to as?

Some not-for-profits, such as mass transit and highway toll roads, attempt to recover only the actual cost of their operation.

What market structure BEST describes the Canadian airline industry?

The above table depicts the marginal revenue and marginal cost at various levels of output.At what level of output is profit maximized?

When setting pricing strategy, some marketers use target-return objectives, which are defined as short-term or long-term revenue targets.

What is the purpose of the Competition Act?

A company has fixed costs of $35 000 and has average variable costs of $7 per item.This company sells 10 000 units and just breaks even.What is the unit selling price for the product?

At present, what are both long-distance telephone services and wireless carriers tending to adhere to?

What is a market structure called with large numbers of buyers and sellers of differentiated products?

What should Proctor & Gamble do if they were to introduce a value-priced brand of laundry detergent?

When the list price of a product is discounted by the value of a used product that is turned in at the time of sale, the transaction is called a sale with a trade-in.

Which of the following is NOT a characteristic of everyday low pricing?

As a pricing strategy, yield management relies on varying the prices of products for which costs are largely fixed, so as to generate the highest possible stream of revenue from their sale.

In breakeven analysis, once all fixed costs have been covered, additional sales will generate per-unit profits equal to the difference between the selling price and the variable cost of each unit.

A company that has adopted a volume objective for its pricing will typically attempt to maximize sales, given that it can achieve some stated minimum acceptable profit level on those sales.

Firms using prestige pricing set relatively high prices to develop and maintain an image of quality and exclusiveness that appeals to status-conscious consumers.

What type of pricing is the exact opposite of FOB origin pricing?

What does the exchange value of a product define?