Question 1

Price is the cash expenditure plus taxes that consumers have to pay for a good or service.

Accepted Answer

A) True 
 B)False

Question 2

Dean runs a woodworking business specializing in kitchen cabinets.He knows there are other firms with top-of-the-line machinery that make better quality cabinets,but he does well and has a constant flow of business.Dean obviously has:

Accepted Answer

A)  figured out how to produce cheap products. 
B)  priced his products well. 
C)  reduced his variable costs by investing in fixed costs. 
D)  avoided monopolistic competition,and is instead in a market with pure competition. 
E)  learned how to use status quo pricing. 
A)  figured out how to produce cheap products. 
B)  priced his products well. 
C)  reduced his variable costs by investing in fixed costs. 
D)  avoided monopolistic competition,and is instead in a market with pure competition. 
E)  learned how to use status quo pricing.

Question 3

A strategy of setting prices based on how customers develop their perceptions of value can often be the most effective pricing strategy,especially if the strategy:

Accepted Answer

A)  leads the marketer to being the low-cost seller. 
B)  is supported by consistent advertising and distribution strategies. 
C)  challenges consumers to discard their perceptions of value. 
D)  is consistent with a competitive target return strategy. 
E)  all of these. 
A)  leads the marketer to being the low-cost seller. 
B)  is supported by consistent advertising and distribution strategies. 
C)  challenges consumers to discard their perceptions of value. 
D)  is consistent with a competitive target return strategy. 
E)  all of these.

Question 4

Marketers advertising an artificially high "regular price" are unethically attempting to influence consumers' __________ perceptions.

Accepted Answer

A)  fixed price 
B)  reference price 
C)  seasonal price 
D)  leader price 
E)  cost-based price 
A)  fixed price 
B)  reference price 
C)  seasonal price 
D)  leader price 
E)  cost-based price

Question 5

Winston's Ice Cream Shop has been in the same location for two decades.Last week,a new ice cream shop opened up just one block down the street.Winston's decides to sell ice cream below cost in order to drive the new shop out of business.What kind of pricing is Winston's using?

Accepted Answer

A)  Predatory pricing 
B)  Competitive pricing 
C)  Ceiling pricing 
D)  Inelastic pricing 
E)  Keystoning 
A)  Predatory pricing 
B)  Competitive pricing 
C)  Ceiling pricing 
D)  Inelastic pricing 
E)  Keystoning

Question 6

Price is the only part of the marketing mix that does not generate costs.

Accepted Answer

A) True 
 B)False

Question 7

Cindy went shopping for a new outfit.She bought a low-priced shirt at a discount store,and combined it with an expensive designer skirt.Which of the following terms best describes Cindy's actions?

Accepted Answer

A)  Cross-shopping 
B)  The income effect 
C)  Cross-price elasticity 
D)  The substitution effect 
E)  Specialty shopping 
A)  Cross-shopping 
B)  The income effect 
C)  Cross-price elasticity 
D)  The substitution effect 
E)  Specialty shopping

Question 8

What is cross-price elasticity? Create an example to explain complementary products.

Accepted Answer

Cross-price elasticity is the percentage

Question 9

The fact that more consumers are buying prestige items like Rolex watches and Mercedes-Benz cars and are,at the same time,shopping more at low-priced discount stores is called:

Accepted Answer

A)  pure competition. 
B)  monopolistic competition. 
C)  the elastic demand phenomenon. 
D)  the income effect. 
E)  cross-shopping. 
A)  pure competition. 
B)  monopolistic competition. 
C)  the elastic demand phenomenon. 
D)  the income effect. 
E)  cross-shopping.

Question 10

__________ lowers the price below the store's cost.

Accepted Answer

A)  Recessionary pricing 
B)  Loss leader pricing 
C)  Radical mark-down pricing 
D)  Employee pricing 
E)  Sales promotion pricing 
A)  Recessionary pricing 
B)  Loss leader pricing 
C)  Radical mark-down pricing 
D)  Employee pricing 
E)  Sales promotion pricing

Question 11

What are some of the important factors that influence price elasticity of demand? Briefly describe the influence the factor has.

Accepted Answer

Students should demonstrate an

Question 12

A mobile carrier decides to introduce a new cellular phone at a high price.This is known as:

Accepted Answer

A)  market penetration. 
B)  everyday low pricing. 
C)  competitor pricing. 
D)  loss leader pricing. 
E)  price skimming. 
A)  market penetration. 
B)  everyday low pricing. 
C)  competitor pricing. 
D)  loss leader pricing. 
E)  price skimming.

Question 13

Barry customizes Harley-Davidson motorcycles.No two cycles are alike.He notices that very few customers even ask the price of his customized motorcycles before they decide to purchase them.Demand for his motorcycles is probably:

Accepted Answer

A)  price sensitive. 
B)  price elastic. 
C)  price inelastic. 
D)  income elastic. 
E)  cross-price elastic. 
A)  price sensitive. 
B)  price elastic. 
C)  price inelastic. 
D)  income elastic. 
E)  cross-price elastic.

Question 14

If the Amador County Pest Control Association got together and all members agreed to charge 3 percent of the value of a home for a termite inspection letter,the association members would be engaging in:

Accepted Answer

A)  loss leader pricing. 
B)  bait and switch pricing. 
C)  horizontal price fixing. 
D)  monopolistic competition. 
E)  predatory pricing. 
A)  loss leader pricing. 
B)  bait and switch pricing. 
C)  horizontal price fixing. 
D)  monopolistic competition. 
E)  predatory pricing.

Question 15

Cheryl wants to quickly establish a dominant market share for her new line of ergonomic pens.To do this,she will likely use a market penetration pricing strategy.

Accepted Answer

A) True 
 B)False

Question 16

Sharon knew that her established customers preferred her product to competitors' offerings.She was planning to expand into new markets,and she was considering pricing.She was leaning toward charging a higher price than competitors to help demonstrate that hers was a high-quality product.Sharon was considering:

Accepted Answer

A)  a top of market strategy. 
B)  the value of quality. 
C)  advantageous pricing. 
D)  premium pricing. 
E)  differential pricing. 
A)  a top of market strategy. 
B)  the value of quality. 
C)  advantageous pricing. 
D)  premium pricing. 
E)  differential pricing.

Price is the cash expenditure plus taxes that consumers have to pay for a good or service.

Dean runs a woodworking business specializing in kitchen cabinets.He knows there are other firms with top-of-the-line machinery that make better quality cabinets,but he does well and has a constant flow of business.Dean obviously has:

A strategy of setting prices based on how customers develop their perceptions of value can often be the most effective pricing strategy,especially if the strategy:

Marketers advertising an artificially high "regular price" are unethically attempting to influence consumers' __________ perceptions.

Winston's Ice Cream Shop has been in the same location for two decades.Last week,a new ice cream shop opened up just one block down the street.Winston's decides to sell ice cream below cost in order to drive the new shop out of business.What kind of pricing is Winston's using?

Price is the only part of the marketing mix that does not generate costs.

Cindy went shopping for a new outfit.She bought a low-priced shirt at a discount store,and combined it with an expensive designer skirt.Which of the following terms best describes Cindy's actions?

What is cross-price elasticity? Create an example to explain complementary products.

The fact that more consumers are buying prestige items like Rolex watches and Mercedes-Benz cars and are,at the same time,shopping more at low-priced discount stores is called:

__________ lowers the price below the store's cost.

What are some of the important factors that influence price elasticity of demand? Briefly describe the influence the factor has.

A mobile carrier decides to introduce a new cellular phone at a high price.This is known as:

Barry customizes Harley-Davidson motorcycles.No two cycles are alike.He notices that very few customers even ask the price of his customized motorcycles before they decide to purchase them.Demand for his motorcycles is probably:

If the Amador County Pest Control Association got together and all members agreed to charge 3 percent of the value of a home for a termite inspection letter,the association members would be engaging in:

Cheryl wants to quickly establish a dominant market share for her new line of ergonomic pens.To do this,she will likely use a market penetration pricing strategy.

Overview of Marketing

Developing Marketing Strategies and a Marketing Plan

Marketing Ethics

Analyzing the Marketing Environment

Consumer Behavior

Business-To-Business Marketing

Global Marketing

Segmentation, Targeting, and Positioning

Marketing Research

Product, Branding, and Packaging Decisions

Developing New Products

Services: The Intangible Product

Supply Chain and Channel Management

Retailing and Multichannel Marketing

Integrated Marketing Communications

Advertising, Public Relations, and Sales Promotions

Personal Selling and Sales Management

Filters

Exam 13: Pricing Concepts for Establishing Value

Price is the cash expenditure plus taxes that consumers have to pay for a good or service.

Dean runs a woodworking business specializing in kitchen cabinets.He knows there are other firms with top-of-the-line machinery that make better quality cabinets,but he does well and has a constant flow of business.Dean obviously has:

A strategy of setting prices based on how customers develop their perceptions of value can often be the most effective pricing strategy,especially if the strategy:

Marketers advertising an artificially high "regular price" are unethically attempting to influence consumers' __________ perceptions.

Winston's Ice Cream Shop has been in the same location for two decades.Last week,a new ice cream shop opened up just one block down the street.Winston's decides to sell ice cream below cost in order to drive the new shop out of business.What kind of pricing is Winston's using?

Price is the only part of the marketing mix that does not generate costs.

Cindy went shopping for a new outfit.She bought a low-priced shirt at a discount store,and combined it with an expensive designer skirt.Which of the following terms best describes Cindy's actions?

What is cross-price elasticity? Create an example to explain complementary products.

The fact that more consumers are buying prestige items like Rolex watches and Mercedes-Benz cars and are,at the same time,shopping more at low-priced discount stores is called:

__________ lowers the price below the store's cost.

What are some of the important factors that influence price elasticity of demand? Briefly describe the influence the factor has.

A mobile carrier decides to introduce a new cellular phone at a high price.This is known as:

Barry customizes Harley-Davidson motorcycles.No two cycles are alike.He notices that very few customers even ask the price of his customized motorcycles before they decide to purchase them.Demand for his motorcycles is probably:

If the Amador County Pest Control Association got together and all members agreed to charge 3 percent of the value of a home for a termite inspection letter,the association members would be engaging in:

Cheryl wants to quickly establish a dominant market share for her new line of ergonomic pens.To do this,she will likely use a market penetration pricing strategy.

Overview of Marketing

Developing Marketing Strategies and a Marketing Plan

Marketing Ethics

Analyzing the Marketing Environment

Consumer Behavior

Business-To-Business Marketing

Global Marketing

Segmentation, Targeting, and Positioning

Marketing Research

Product, Branding, and Packaging Decisions

Developing New Products

Services: The Intangible Product

Supply Chain and Channel Management

Retailing and Multichannel Marketing

Integrated Marketing Communications

Advertising, Public Relations, and Sales Promotions

Personal Selling and Sales Management

Filters