Question 1

Price deals that mislead consumers fall into the category of

Accepted Answer

A) predatory pricing. 
B) deceptive pricing. 
C) price discrimination. 
D) buyer beware. 
E) base point pricing. 
A) predatory pricing. 
B) deceptive pricing. 
C) price discrimination. 
D) buyer beware. 
E) base point pricing. B

Question 2

FIGURE 12-1  
-Figure 12-1 above represents the four approaches for selecting an appropriate price level.Cubicle "D" represents which approach to finding the approximate price level according to the items listed in the cell?

Accepted Answer

A) demand-oriented approach 
B) cost-oriented approach 
C) profit-oriented approach 
D) competition-oriented approach 
E) profit-equation approach 
A) demand-oriented approach 
B) cost-oriented approach 
C) profit-oriented approach 
D) competition-oriented approach 
E) profit-equation approach D

Question 3

North America's fastest-growing HDTV and consumer electronics company is

Accepted Answer

A) Samsung. 
B) Phillips. 
C) LG. 
D) Sony. 
E) Vizio. 
A) Samsung. 
B) Phillips. 
C) LG. 
D) Sony. 
E) Vizio. E

Question 4

The practice of changing a very low price for a product with the intent of driving competitors out of business is referred to as

Accepted Answer

A) price fixing. 
B) price discrimination. 
C) predatory pricing. 
D) deceptive pricing. 
E) geographical pricing. 
A) price fixing. 
B) price discrimination. 
C) predatory pricing. 
D) deceptive pricing. 
E) geographical pricing.

Question 5

A trade-in allowance refers to a(n)

Accepted Answer

A) exchange of one product for another of equal or greater value without an exchange of cash. 
B) cash back exchange when a more expensive item is replaced with a less expensive item. 
C) price reduction given when a used product is part of the payment on a new product. 
D) price reduction given when a used product is part of the payment for a large ticket item or bulk purchase. 
E) price reduction given in exchange when a used product is part of the payment provided the older product is of the same make and model of the newer product. 
A) exchange of one product for another of equal or greater value without an exchange of cash. 
B) cash back exchange when a more expensive item is replaced with a less expensive item. 
C) price reduction given when a used product is part of the payment on a new product. 
D) price reduction given when a used product is part of the payment for a large ticket item or bulk purchase. 
E) price reduction given in exchange when a used product is part of the payment provided the older product is of the same make and model of the newer product.

Question 6

A demand curve graph typically appears as

Accepted Answer

A) a parabola with the apex representing the highest price that can be charged without losing customers. 
B) as an inverted parabola with the lowest point representing the lowest price that can be charged and still meet the company's profit objectives. 
C) a diagonal line going from top left to bottom right demonstrating that as price goes down, demand goes up. 
D) a diagonal line going from lower left to upper right demonstrating that as prices go up, demand goes up proportionately. 
E) two intersecting lines that identify the point at which supply and demand are exactly the same. 
A) a parabola with the apex representing the highest price that can be charged without losing customers. 
B) as an inverted parabola with the lowest point representing the lowest price that can be charged and still meet the company's profit objectives. 
C) a diagonal line going from top left to bottom right demonstrating that as price goes down, demand goes up. 
D) a diagonal line going from lower left to upper right demonstrating that as prices go up, demand goes up proportionately. 
E) two intersecting lines that identify the point at which supply and demand are exactly the same.

Question 7

Hallmark was the official supplier of flowers at the last Winter Olympics.It was the first time that it has participated in the Olympics.Hallmark presented each Olympic winner with a special bouquet of roses designed to resemble the Olympic torch.Consumers were able to buy a smaller version of this same bouquet at the Hallmark Web site for $74.95.The Olympic bouquet that consumers could buy contains two dozen yellow roses, yet you can buy two dozen yellow roses for less than $35 at most supermarkets.If Hallmark is treating the Olympic bouquet as an innovative product, then it is using which demand-oriented approach to pricing?

Accepted Answer

A) bundle pricing 
B) skimming pricing 
C) penetration pricing 
D) yield management pricing 
E) target return-on-sales pricing 
A) bundle pricing 
B) skimming pricing 
C) penetration pricing 
D) yield management pricing 
E) target return-on-sales pricing

Question 8

Predatory pricing refers to

Accepted Answer

A) a conspiracy among firms to set prices for a product. 
B) using price differentials when charging different prices on the basis of race, religion, or ethnic affiliation. 
C) the practice of changing a very low price for a product with the intent of driving competitors out of business. 
D) using price differentials when charging the original price for goods that have been damaged but repaired according to company specifications. 
E) controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price. 
A) a conspiracy among firms to set prices for a product. 
B) using price differentials when charging different prices on the basis of race, religion, or ethnic affiliation. 
C) the practice of changing a very low price for a product with the intent of driving competitors out of business. 
D) using price differentials when charging the original price for goods that have been damaged but repaired according to company specifications. 
E) controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price.

Question 9

A shift in the demand curve is illustrated by which of the following?

Accepted Answer

A) When prices remain the same, there is an increase or decrease in demand. 
B) When prices remain the same, there is a significant decrease in demand. 
C) As the price is raised, the quantity demanded increases, assuming all else stays the same. 
D) As the price is lowered, the quantity demanded increases, assuming all else stays the same. 
E) Movement along the curve rather than a shift of the curve indicates that some significant event has taken place outside the organization that has affected demand. 
A) When prices remain the same, there is an increase or decrease in demand. 
B) When prices remain the same, there is a significant decrease in demand. 
C) As the price is raised, the quantity demanded increases, assuming all else stays the same. 
D) As the price is lowered, the quantity demanded increases, assuming all else stays the same. 
E) Movement along the curve rather than a shift of the curve indicates that some significant event has taken place outside the organization that has affected demand.

Question 10

When is skimming pricing an effective strategy?

Accepted Answer

Skimming pricing is an effective strateg

Question 11

Washburn Guitars broke their guitars into four distinct market segments.Each segment would be priced accordingly.Their batch-custom products instruments were intended to appeal to

Accepted Answer

A) first-time buyers. 
B) professional musicians. 
C) stars and famous musicians. 
D) large institutional buys such as band programs. 
E) intermediate skill players who might (or might not) become professional musicians. 
A) first-time buyers. 
B) professional musicians. 
C) stars and famous musicians. 
D) large institutional buys such as band programs. 
E) intermediate skill players who might (or might not) become professional musicians.

Question 12

Which of the following statements regarding market share pricing objectives is most accurate?

Accepted Answer

A) A market share pricing objective is often difficult for product managers since stockholders are looking for immediate profits and obtaining market share usually takes time. 
B) Although increased market share is a primary goal of some firms, others see it as a means to other ends such as increased sales or profits. 
C) Selecting market share as a pricing objective is particularly effective if industry sales are beginning to rise or peak. 
D) An advantage of market share as a pricing objective is that it is particularly insensitive to competitors' actions. 
E) Ironically, market share pricing objectives are obtained by raising prices in order to increase consumer confidence during the decline stage of a product's life cycle. 
A) A market share pricing objective is often difficult for product managers since stockholders are looking for immediate profits and obtaining market share usually takes time. 
B) Although increased market share is a primary goal of some firms, others see it as a means to other ends such as increased sales or profits. 
C) Selecting market share as a pricing objective is particularly effective if industry sales are beginning to rise or peak. 
D) An advantage of market share as a pricing objective is that it is particularly insensitive to competitors' actions. 
E) Ironically, market share pricing objectives are obtained by raising prices in order to increase consumer confidence during the decline stage of a product's life cycle.

Question 13

A firm's profit equation demonstrates that profit equals _________, or _________.

Accepted Answer

A) Total cost + Total revenue; (Unit price x Quantity sold)-(Fixed cost + Variable cost) 
B) Total revenue-Total cost; (Unit price x Quantity sold)-(Fixed cost + Variable cost) 
C) Total cost-Marginal cost; (Fixed cost + Variable cost) /(Unit price x Quantity sold) 
D) Total cost-Variable cost; (Fixed cost + Variable cost) + (Unit price x Quantity sold) 
E) Total revenue + Total cost; (Unit price x Quantity sold)-(Fixed cost + Variable cost) 
A) Total cost + Total revenue; (Unit price x Quantity sold)-(Fixed cost + Variable cost) 
B) Total revenue-Total cost; (Unit price x Quantity sold)-(Fixed cost + Variable cost) 
C) Total cost-Marginal cost; (Fixed cost + Variable cost) /(Unit price x Quantity sold) 
D) Total cost-Variable cost; (Fixed cost + Variable cost) + (Unit price x Quantity sold) 
E) Total revenue + Total cost; (Unit price x Quantity sold)-(Fixed cost + Variable cost)

Question 14

When Sherman bought gas, he noticed the convenience store offered him a 3 percent reduction in price if he paid cash rather than used his credit card.The convenience store was offering him a

Accepted Answer

A) trade discount. 
B) cash discount. 
C) promotional allowance. 
D) rebate. 
E) functional discount. 
A) trade discount. 
B) cash discount. 
C) promotional allowance. 
D) rebate. 
E) functional discount.

Question 15

FIGURE 12-11  
-What type of discount can Payless offer its channel members to sell sandals (Figure 12-11 above) during the winter months?

Accepted Answer

A) noncumulative discounts. 
B) cumulative discounts. 
C) functional discounts 
D) seasonal discounts. 
E) trade discounts. 
A) noncumulative discounts. 
B) cumulative discounts. 
C) functional discounts 
D) seasonal discounts. 
E) trade discounts.

Question 16

Pricing constraints refer to

Accepted Answer

A) barriers that must be overcome in order to set pricing objectives. 
B) competitive pricing advantages one firm has over another. 
C) different pricing strategies for each of the firm's products. 
D) factors that limit the range of prices a firm may set. 
E) another name for demand curves. 
A) barriers that must be overcome in order to set pricing objectives. 
B) competitive pricing advantages one firm has over another. 
C) different pricing strategies for each of the firm's products. 
D) factors that limit the range of prices a firm may set. 
E) another name for demand curves.

Question 17

In the cash discount $500 4/10 net 30, the number 10 refers to

Accepted Answer

A) the percentage discounted if the bill is paid within 30 days. 
B) the percentage increase in price if the bill is not paid within 10days. 
C) the number of days for which the discount is valid. 
D) the discount in dollars per unit awarded if the order is paid on time. 
E) the penalty in dollars in dollars if the bill is not paid within 10days. 
A) the percentage discounted if the bill is paid within 30 days. 
B) the percentage increase in price if the bill is not paid within 10days. 
C) the number of days for which the discount is valid. 
D) the discount in dollars per unit awarded if the order is paid on time. 
E) the penalty in dollars in dollars if the bill is not paid within 10days.

Question 18

When buying a car, __________ may result in discriminatory practices.

Accepted Answer

A) fixed pricing 
B) one pricing 
C) flexible pricing 
D) trade pricing 
E) discount pricing 
A) fixed pricing 
B) one pricing 
C) flexible pricing 
D) trade pricing 
E) discount pricing

Question 19

Three different objectives relate to a firm's profit, which is often measured in terms of return on investment (ROI).These objectives have different implications for pricing strategy.The three objectives include managing for long-run profits; maximizing current profit objectives, and _________.

Accepted Answer

A) a target return 
B) break-even recovery 
C) profit reinvestment 
D) profit redistribution 
E) target equalization 
A) a target return 
B) break-even recovery 
C) profit reinvestment 
D) profit redistribution 
E) target equalization

Question 20

Reductions in unit costs for a larger order are referred to as

Accepted Answer

A) promotional allowances. 
B) quantity discounts. 
C) one-price policy prices. 
D) penetration prices. 
E) size of order allowances. 
A) promotional allowances. 
B) quantity discounts. 
C) one-price policy prices. 
D) penetration prices. 
E) size of order allowances.

Price deals that mislead consumers fall into the category of

FIGURE 12-1 -Figure 12-1 above represents the four approaches for selecting an appropriate price level.Cubicle "D" represents which approach to finding the approximate price level according to the items listed in the cell?

North America's fastest-growing HDTV and consumer electronics company is

The practice of changing a very low price for a product with the intent of driving competitors out of business is referred to as

A trade-in allowance refers to a(n)

A demand curve graph typically appears as

Predatory pricing refers to

A shift in the demand curve is illustrated by which of the following?

When is skimming pricing an effective strategy?

Washburn Guitars broke their guitars into four distinct market segments.Each segment would be priced accordingly.Their batch-custom products instruments were intended to appeal to

Which of the following statements regarding market share pricing objectives is most accurate?

A firm's profit equation demonstrates that profit equals _, or _.

When Sherman bought gas, he noticed the convenience store offered him a 3 percent reduction in price if he paid cash rather than used his credit card.The convenience store was offering him a

FIGURE 12-11 -What type of discount can Payless offer its channel members to sell sandals (Figure 12-11 above) during the winter months?

Pricing constraints refer to

In the cash discount $500 4/10 net 30, the number 10 refers to

When buying a car, __________ may result in discriminatory practices.

Three different objectives relate to a firm's profit, which is often measured in terms of return on investment (ROI).These objectives have different implications for pricing strategy.The three objectives include managing for long-run profits; maximizing current profit objectives, and _________.

Reductions in unit costs for a larger order are referred to as

Creating Customer Relationships and Value Through Marketing

Developing Successful Marketing and Organizational Strategies

Scanning the Marketing Environment

Ethical and Social Responsibility in Marketing

Understanding Consumer Behavior

Understanding Organizations As Customers

Understanding and Reaching Global Consumers and Markets

Marketing Research: From Customer Insights to Actions

Market Segmentation, Targeting, and Positioning

Developing New Products and Services

Managing Successful Products, Services, and Brands

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Personal Selling and Sales Management

Building an Effective Marketing Plan

Filters

Exam 12: Pricing Products and Services

Price deals that mislead consumers fall into the category of

FIGURE 12-1 -Figure 12-1 above represents the four approaches for selecting an appropriate price level.Cubicle "D" represents which approach to finding the approximate price level according to the items listed in the cell?

North America's fastest-growing HDTV and consumer electronics company is

The practice of changing a very low price for a product with the intent of driving competitors out of business is referred to as

A trade-in allowance refers to a(n)

A demand curve graph typically appears as

Predatory pricing refers to

A shift in the demand curve is illustrated by which of the following?

When is skimming pricing an effective strategy?

Washburn Guitars broke their guitars into four distinct market segments.Each segment would be priced accordingly.Their batch-custom products instruments were intended to appeal to

Which of the following statements regarding market share pricing objectives is most accurate?

A firm's profit equation demonstrates that profit equals _________, or _________.

When Sherman bought gas, he noticed the convenience store offered him a 3 percent reduction in price if he paid cash rather than used his credit card.The convenience store was offering him a

FIGURE 12-11 -What type of discount can Payless offer its channel members to sell sandals (Figure 12-11 above) during the winter months?

Pricing constraints refer to

In the cash discount $500 4/10 net 30, the number 10 refers to

When buying a car, __________ may result in discriminatory practices.

Three different objectives relate to a firm's profit, which is often measured in terms of return on investment (ROI).These objectives have different implications for pricing strategy.The three objectives include managing for long-run profits; maximizing current profit objectives, and _________.

Reductions in unit costs for a larger order are referred to as

Creating Customer Relationships and Value Through Marketing

Developing Successful Marketing and Organizational Strategies

Scanning the Marketing Environment

Ethical and Social Responsibility in Marketing

Understanding Consumer Behavior

Understanding Organizations As Customers

Understanding and Reaching Global Consumers and Markets

Marketing Research: From Customer Insights to Actions

Market Segmentation, Targeting, and Positioning

Developing New Products and Services

Managing Successful Products, Services, and Brands

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Personal Selling and Sales Management

Building an Effective Marketing Plan

Filters

A firm's profit equation demonstrates that profit equals _, or _.