Question 1

Manufacturers of generic brands use which method of competition-oriented pricing?

Accepted Answer

A) penetration pricing 
B) below-market pricing 
C) loss-leader pricing 
D) prestige pricing 
E) skimming pricing 
A) penetration pricing 
B) below-market pricing 
C) loss-leader pricing 
D) prestige pricing 
E) skimming pricing

Question 2

Managing for long-run profits as a pricing objective implies that a company will

Accepted Answer

A) give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets. 
B) maintain a given price range to ensure there is no loss of customers over time, even if the profit margin declines. 
C) invest excess cash in bonds and certificates of deposit in order to counteract any inflationary economic changes in the future. 
D) reinvest all profits into market or product research rather than returned to shareholders. 
E) drop all products, product lines, or divisions that cannot maintain their pricing goals. 
A) give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets. 
B) maintain a given price range to ensure there is no loss of customers over time, even if the profit margin declines. 
C) invest excess cash in bonds and certificates of deposit in order to counteract any inflationary economic changes in the future. 
D) reinvest all profits into market or product research rather than returned to shareholders. 
E) drop all products, product lines, or divisions that cannot maintain their pricing goals.

Question 3

If you were to buy one peach tree and one apple tree from the Stark Bros. fruit trees and landscaping catalog in two separate orders, you would pay a total of $109.99. However, if you order the peach and apple tree in the same order, you pay only $89.99. When selling the two trees together for a reduced price, what pricing strategy does Stark Bros. employ?

Accepted Answer

A) product line pricing 
B) prestige pricing 
C) price lining 
D) discount pricing 
E) bundle pricing 
A) product line pricing 
B) prestige pricing 
C) price lining 
D) discount pricing 
E) bundle pricing

Question 4

-Figure 11-2 above represents the four approaches to selecting an appropriate price level. Box D includes customary and loss leader so it represents which approach?

Accepted Answer

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

Question 5

Which of the following companies would be most likely to use target return-on-investment pricing?

Accepted Answer

A) a farmer 
B) a florist shop 
C) a book publisher 
D) a veterinarian 
E) an automobile manufacturer 
A) a farmer 
B) a florist shop 
C) a book publisher 
D) a veterinarian 
E) an automobile manufacturer

Question 6

All of the following are competition-oriented approaches to selecting an approximate price level EXCEPT:

Accepted Answer

A) loss leader pricing. 
B) customary pricing. 
C) above-market pricing. 
D) skimming. 
E) at-market pricing. 
A) loss leader pricing. 
B) customary pricing. 
C) above-market pricing. 
D) skimming. 
E) at-market pricing.

Question 7

The manufacturer of a new kind of fat-free ice cream that has the consistency and taste of regular ice cream is thinking of using a penetration pricing strategy for its new product. Which of the following conditions would argue AGAINST using a penetration pricing strategy for the tasty dessert treat?

Accepted Answer

A) The ice cream market is highly conservative. 
B) Economies of scale in production would be substantial. 
C) Retailers are not willing to carry new brands of ice cream in the already overcrowded category. 
D) Once the initial price is set, it is nearly impossible to lower the price without alienating early buyers. 
E) The ice cream market exhibits inelastic demand over a fairly broad range of prices. 
A) The ice cream market is highly conservative. 
B) Economies of scale in production would be substantial. 
C) Retailers are not willing to carry new brands of ice cream in the already overcrowded category. 
D) Once the initial price is set, it is nearly impossible to lower the price without alienating early buyers. 
E) The ice cream market exhibits inelastic demand over a fairly broad range of prices.

Question 8

Setting prices a few dollars or cents under an even number is referred to as __________.

Accepted Answer

A) odd-even pricing 
B) prestige pricing 
C) price lining 
D) above-, at-, or below-market pricing 
E) every day fair pricing 
A) odd-even pricing 
B) prestige pricing 
C) price lining 
D) above-, at-, or below-market pricing 
E) every day fair pricing

Question 9

Which of the following statements regarding cost-oriented approaches is most accurate?

Accepted Answer

A) These methods focus on the demand side of the pricing problem. 
B) These methods focus on production and marketing expenses. 
C) Target return on investment is an example of a cost-oriented method. 
D) Experience curve pricing is simple to use because costs predictably decrease by 25 percent with each doubling of production. 
E) Cost-oriented approaches are a subcategory of competition-oriented methods. 
A) These methods focus on the demand side of the pricing problem. 
B) These methods focus on production and marketing expenses. 
C) Target return on investment is an example of a cost-oriented method. 
D) Experience curve pricing is simple to use because costs predictably decrease by 25 percent with each doubling of production. 
E) Cost-oriented approaches are a subcategory of competition-oriented methods.

Question 10

Quantity discounts refer to

Accepted Answer

A) price reductions in unit costs for placing a larger order. 
B) price reductions for placing long-term pre-scheduled orders. 
C) price reductions to encourage retailers to stock inventory earlier than their normal demand would require. 
D) reductions that are offered for paying bills early. 
E) reductions in unit costs for taking merchandise that will soon be replaced by new and improved versions of the original product. 
A) price reductions in unit costs for placing a larger order. 
B) price reductions for placing long-term pre-scheduled orders. 
C) price reductions to encourage retailers to stock inventory earlier than their normal demand would require. 
D) reductions that are offered for paying bills early. 
E) reductions in unit costs for taking merchandise that will soon be replaced by new and improved versions of the original product.

Question 11

A firm's profit objective is often measured in terms of ROA. The acronym ROA stands for __________.

Accepted Answer

A) return on assets 
B) risk opportunity assessment 
C) return of allowances 
D) return on average equity 
E) risk opportunity analysis 
A) return on assets 
B) risk opportunity assessment 
C) return of allowances 
D) return on average equity 
E) risk opportunity analysis

Question 12

-In Figure 11-6 above, which is a break-even chart that depicts a graphic presentation of a break-even analysis for a picture frame store, the triangular area GAF represents the firm's

Accepted Answer

A) fixed costs. 
B) break-even point. 
C) variable costs. 
D) profit. 
E) total revenue 
A) fixed costs. 
B) break-even point. 
C) variable costs. 
D) profit. 
E) total revenue

Question 13

After setting an approximate price level, the marketer proceeds to which step of the price-setting process?

Accepted Answer

A) Defining the scope of the product 
B) Seeking regulatory affirmation for the price point 
C) Setting the list or quoted price 
D) Evaluating the success of the price strategy 
E) Making special adjustments to the list price 
A) Defining the scope of the product 
B) Seeking regulatory affirmation for the price point 
C) Setting the list or quoted price 
D) Evaluating the success of the price strategy 
E) Making special adjustments to the list price

Question 14

According to the price equation, final price equals list price minus __________ plus extra fees.

Accepted Answer

A) profits 
B) commissions 
C) trade-ins 
D) taxes 
E) incentives and allowances 
A) profits 
B) commissions 
C) trade-ins 
D) taxes 
E) incentives and allowances

Question 15

The __________ of a product is what customers are generally willing to pay, and is sometimes used as a benchmark for pricing.

Accepted Answer

A) customary price 
B) asking price 
C) target price 
D) discount price 
E) market price 
A) customary price 
B) asking price 
C) target price 
D) discount price 
E) market price

Question 16

Functional discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

Accepted Answer

A) the size of the order. 
B) the frequency of the order. 
C) when orders are placed during the year. 
D) the length of the relationship with the manufacturer. 
E) the marketing activities they are expected to perform in the future 
A) the size of the order. 
B) the frequency of the order. 
C) when orders are placed during the year. 
D) the length of the relationship with the manufacturer. 
E) the marketing activities they are expected to perform in the future

Question 17

Using __________, many retailers deliberately sell products below their normal prices (and sometimes below cost) to attract attention and additional store traffic.

Accepted Answer

A) customary pricing 
B) below-market pricing 
C) prestige pricing 
D) penetration pricing 
E) loss-leader pricing 
A) customary pricing 
B) below-market pricing 
C) prestige pricing 
D) penetration pricing 
E) loss-leader pricing

Question 18

Tendollars.com offers thousands of gifts, all priced at $10. This is an example of a(n) __________.

Accepted Answer

A) skimming pricing approach 
B) loss-leader pricing approach 
C) one-price policy 
D) penetration pricing approach 
E) everyday low pricing approach 
A) skimming pricing approach 
B) loss-leader pricing approach 
C) one-price policy 
D) penetration pricing approach 
E) everyday low pricing approach

Question 19

What are the four kinds of discounts that are especially important in marketing pricing strategy?

Accepted Answer

Discounts are reductions from list price

Question 20

Customary pricing refers to

Accepted Answer

A) a pricing method where the price the seller quotes includes all transportation costs. 
B) setting the same price for similar customers who buy the same product and quantities under the same conditions. 
C) deliberately selling a product below its list price to attract attention to it. 
D) setting a price that is dictated by tradition, a standardized channel of distribution, or other competitive factors. 
E) pricing based on what the market will bear. 
A) a pricing method where the price the seller quotes includes all transportation costs. 
B) setting the same price for similar customers who buy the same product and quantities under the same conditions. 
C) deliberately selling a product below its list price to attract attention to it. 
D) setting a price that is dictated by tradition, a standardized channel of distribution, or other competitive factors. 
E) pricing based on what the market will bear.

Manufacturers of generic brands use which method of competition-oriented pricing?

Managing for long-run profits as a pricing objective implies that a company will

-Figure 11-2 above represents the four approaches to selecting an appropriate price level. Box D includes customary and loss leader so it represents which approach?

Which of the following companies would be most likely to use target return-on-investment pricing?

All of the following are competition-oriented approaches to selecting an approximate price level EXCEPT:

Setting prices a few dollars or cents under an even number is referred to as __________.

Which of the following statements regarding cost-oriented approaches is most accurate?

Quantity discounts refer to

A firm's profit objective is often measured in terms of ROA. The acronym ROA stands for __________.

-In Figure 11-6 above, which is a break-even chart that depicts a graphic presentation of a break-even analysis for a picture frame store, the triangular area GAF represents the firm's

After setting an approximate price level, the marketer proceeds to which step of the price-setting process?

According to the price equation, final price equals list price minus __________ plus extra fees.

The __________ of a product is what customers are generally willing to pay, and is sometimes used as a benchmark for pricing.

Functional discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

Using __________, many retailers deliberately sell products below their normal prices (and sometimes below cost) to attract attention and additional store traffic.

Tendollars.com offers thousands of gifts, all priced at $10. This is an example of a(n) __________.

What are the four kinds of discounts that are especially important in marketing pricing strategy?

Customary pricing refers to

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility

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

Using Social Media to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multichannel Marketing

Filters

Exam 11: Pricing Products and Services

Manufacturers of generic brands use which method of competition-oriented pricing?

Managing for long-run profits as a pricing objective implies that a company will

-Figure 11-2 above represents the four approaches to selecting an appropriate price level. Box D includes customary and loss leader so it represents which approach?

Which of the following companies would be most likely to use target return-on-investment pricing?

All of the following are competition-oriented approaches to selecting an approximate price level EXCEPT:

Setting prices a few dollars or cents under an even number is referred to as __________.

Which of the following statements regarding cost-oriented approaches is most accurate?

Quantity discounts refer to

A firm's profit objective is often measured in terms of ROA. The acronym ROA stands for __________.

-In Figure 11-6 above, which is a break-even chart that depicts a graphic presentation of a break-even analysis for a picture frame store, the triangular area GAF represents the firm's

After setting an approximate price level, the marketer proceeds to which step of the price-setting process?

According to the price equation, final price equals list price minus __________ plus extra fees.

The __________ of a product is what customers are generally willing to pay, and is sometimes used as a benchmark for pricing.

Functional discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

Using __________, many retailers deliberately sell products below their normal prices (and sometimes below cost) to attract attention and additional store traffic.

Tendollars.com offers thousands of gifts, all priced at $10. This is an example of a(n) __________.

What are the four kinds of discounts that are especially important in marketing pricing strategy?

Customary pricing refers to

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility

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

Using Social Media to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multichannel Marketing

Filters