Question 1

competitive market situation in which the few sellers are sensitive to each other's prices is referred to as

Accepted Answer

A)  pure monopoly. 
B)  oligopoly. 
C)  monopolistic competition. 
D)  pure competition. 
E)  oligopolistic competition. 
A)  pure monopoly. 
B)  oligopoly. 
C)  monopolistic competition. 
D)  pure competition. 
E)  oligopolistic competition.

Question 2

unit variable cost (UVC)equals variable cost (VC)divided by __________.

Accepted Answer

A)  quantity (Q) 
B)  fixed costs (F
C)  
C)  total cost (T
C)  
D)  total revenue (TR) 
E)  price per unit of the product (P) 
A)  quantity (Q) 
B)  fixed costs (F
C)  
C)  total cost (T
C)  
D)  total revenue (TR) 
E)  price per unit of the product (P)

Question 3

Which of the following statements about StubHub is most accurate?

Accepted Answer

A)  StubHub recently purchased Amazon.com for $253 million dollars. 
B)  StubHub has established relationships with deal-making social networking firms LivingSocial and Groupon. 
C)  StubHub had plans to enter the European market, but EU regulations made the plan unfeasible. 
D)  StubHub and Ticketmaster have a nonbinding agreement to cater to separate market segments (sports vs. concert) to avoid undue competition. 
E)  StubHub has had difficulty selling tickets in some states because they view the brokering of tickets as ticket scalping, which is illegal. 
A)  StubHub recently purchased Amazon.com for $253 million dollars. 
B)  StubHub has established relationships with deal-making social networking firms LivingSocial and Groupon. 
C)  StubHub had plans to enter the European market, but EU regulations made the plan unfeasible. 
D)  StubHub and Ticketmaster have a nonbinding agreement to cater to separate market segments (sports vs. concert) to avoid undue competition. 
E)  StubHub has had difficulty selling tickets in some states because they view the brokering of tickets as ticket scalping, which is illegal.

Question 4

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

Accepted Answer

A)  risk opportunity investment 
B)  revised organizational incentives 
C)  return on investment 
D)  regulated organizational investments 
E)  replenishment of organizational inventories 
A)  risk opportunity investment 
B)  revised organizational incentives 
C)  return on investment 
D)  regulated organizational investments 
E)  replenishment of organizational inventories

Question 5

target return profit objective implies that a company chooses to

Accepted Answer

A)  set targets whose performance can be measured quickly. 
B)  give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets. 
C)  set a profit goal that is often determined by its board of directors. 
D)  reduce investment in any further market or product research. 
E)  set prices based on return on sales. 
A)  set targets whose performance can be measured quickly. 
B)  give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets. 
C)  set a profit goal that is often determined by its board of directors. 
D)  reduce investment in any further market or product research. 
E)  set prices based on return on sales.

Question 6

buying situation can involve comparing the costs and benefits of substitute items-such as real sugar to the sugar substitute Splenda,which,although more expensive than sugar,is purchased by many consumers because it contains no calories.This situation involves the consumer considering

Accepted Answer

A)  a marginal analysis. 
B)  a profit equation. 
C)  a break-even analysis. 
D)  price elasticity of demand. 
E)  a reference value. 
A)  a marginal analysis. 
B)  a profit equation. 
C)  a break-even analysis. 
D)  price elasticity of demand. 
E)  a reference value.

Question 7

Figure 13-10A
-Figure 13-10A above,"X" represents

Accepted Answer

A)  fixed cost 
B)  marginal cost 
C)  variable cost 
D)  marginal revenue 
E)  MR = MC 
A)  fixed cost 
B)  marginal cost 
C)  variable cost 
D)  marginal revenue 
E)  MR = MC

Question 8

Renfro's,Inc.,is a company that sells 25 different relishes in 45 different states.Mrs.Renfro's chipotle corn salsa is so popular that the company cannot make enough to keep its resellers stocked.Its price of $4.50 for a jar seems just right to consumers who savor its hot and spicy taste.The popularity of hot and spicy food is an example of a __________ that Mrs.Renfro's has taken advantage of to make its product a success.

Accepted Answer

A)  barter factor 
B)  demand factor 
C)  supply factor 
D)  consumer index 
E)  macroeconomic environmental factor 
A)  barter factor 
B)  demand factor 
C)  supply factor 
D)  consumer index 
E)  macroeconomic environmental factor

Question 9

Ampro-Mag is a small company that makes materials for safely controlling hazardous spills of all kinds.It sells these items as a neutralizing kit priced at $100.The costs of the materials that go into each kit are $45.It costs $5 in labor to assemble a kit.The company has monthly expenses of $1,000 for rent and insurance,$200 for heat and electricity,$500 for advertising in trade journals,and $3,500 for the monthly salary of its owner.What is Ampro-Mag's monthly break-even point in terms of number of neutralizing kits sold?

Accepted Answer

A)  40 kits 
B)  52 kits 
C)  104 kits 
D)  116 kits 
E)  520 kits 
A)  40 kits 
B)  52 kits 
C)  104 kits 
D)  116 kits 
E)  520 kits

Question 10

Small regional producers selling grocery products have a special problem because they need to set prices at which both they and their channel members can profit while

Accepted Answer

A)  competing with other brands to gain valuable space on supermarket shelves. 
B)  still maintaining local customer loyalty. 
C)  trying to go head-to-head or steal market share from nationally recognized brands. 
D)  keeping other regional businesses from entering the market. 
E)  avoiding cannibalization if they sell their product both in stores and online. 
A)  competing with other brands to gain valuable space on supermarket shelves. 
B)  still maintaining local customer loyalty. 
C)  trying to go head-to-head or steal market share from nationally recognized brands. 
D)  keeping other regional businesses from entering the market. 
E)  avoiding cannibalization if they sell their product both in stores and online.

Question 11

Estimating demand,sales revenue,and price elasticity are issues that would be addressed during __________ of the price-setting process.

Accepted Answer

A)  Step 1 
B)  Step 2 
C)  Step 3 
D)  Step 4 
E)  Step 5 
A)  Step 1 
B)  Step 2 
C)  Step 3 
D)  Step 4 
E)  Step 5

Question 12

company that manages apartments decides to buy 15 new dishwashers at a list price of $550 each as replacements for old dishwashers in a small apartment complex it owns.Because the company is buying more than 10 dishwashers,it is eligible for a $150-per-unit quantity discount.Financing charges total $20 per unit.The company gets $10 per dishwasher for the 15 dishwashers traded in.What is the final price the company will pay for each dishwasher?

Accepted Answer

A)  $390 
B)  $400 
C)  $410 
D)  $530 
E)  $560 
A)  $390 
B)  $400 
C)  $410 
D)  $530 
E)  $560

Question 13

Microsoft,Sony,and Nintendo are the three principal firms in the video game console market.Using Figure 13-4,how much price competition is most likely for video game makers?

Accepted Answer

A)  There is almost none; the market sets the price. 
B)  There is some competition within a range of prices. 
C)  There is generally a price leader that sets the price. 
D)  Each firm is aware of each other's prices and may adjust them based on the prices of the other two firms. 
E)  Price is set by the seller but regulated by the government. 
A)  There is almost none; the market sets the price. 
B)  There is some competition within a range of prices. 
C)  There is generally a price leader that sets the price. 
D)  Each firm is aware of each other's prices and may adjust them based on the prices of the other two firms. 
E)  Price is set by the seller but regulated by the government.

Question 14

ratio of perceived benefits to __________ is referred to as value.

Accepted Answer

A)  price 
B)  prestige 
C)  perceived quality 
D)  profits 
E)  perceived costs 
A)  price 
B)  prestige 
C)  perceived quality 
D)  profits 
E)  perceived costs

Question 15

Shoe Co.has fixed costs of $6 million and unit variable costs of $5 per pair.Suppose a consultant tells Ace it can sell 700,000 pairs of shoes,thus earning a profit of $2.5 million.What potential error is the consultant making?

Accepted Answer

A)  assuming that fixed costs are independent of price 
B)  assuming that units sold is independent of price 
C)  assuming that some fixed costs are variable 
D)  assuming that some variable costs are fixed 
E)  assuming that variable costs are independent of price 
A)  assuming that fixed costs are independent of price 
B)  assuming that units sold is independent of price 
C)  assuming that some fixed costs are variable 
D)  assuming that some variable costs are fixed 
E)  assuming that variable costs are independent of price

Question 16

Figure 13-7
-According to Figure 13-7 above,what is the price of Newsweek when marginal revenue is $0?

Accepted Answer

A)  $0 
B)  $0.50 
C)  $1.00 
D)  $1.50 
E)  $2.00 
A)  $0 
B)  $0.50 
C)  $1.00 
D)  $1.50 
E)  $2.00

Question 17

Forever Quilting is a small company that makes quilting kits priced at $120.The costs of the materials that go into each kit are $45.It costs $5 in labor to assemble a kit.The company has monthly expenses of $1,000 for rent and insurance,$200 for heat and electricity,$500 for advertising,and $4,500 for the monthly salary of its owner.Forever Quilting's unit variable cost for its kits is

Accepted Answer

A)  $5. 
B)  $45. 
C)  $50. 
D)  $120. 
E)  $170. 
A)  $5. 
B)  $45. 
C)  $50. 
D)  $120. 
E)  $170.

Question 18

Price elasticity of demand is determined by a number of factors,such as whether the item is a luxury product or service,the necessity of the product or service,the cash outlay of purchase relative to a person's disposable income,and

Accepted Answer

A)  the stage of the product or service in its product life cycle. 
B)  the degree of carrying costs for the manufacturer or distributor. 
C)  the availability of substitutes. 
D)  the financial resources of the organization itself. 
E)  the ability of the organization to meet sudden increases in demand. 
A)  the stage of the product or service in its product life cycle. 
B)  the degree of carrying costs for the manufacturer or distributor. 
C)  the availability of substitutes. 
D)  the financial resources of the organization itself. 
E)  the ability of the organization to meet sudden increases in demand.

Question 19

have been asked to calculate the break-even point for a new line of souvenir T-shirts.The selling price will be $25 per shirt.The labor cost is $5 per shirt.The administrative costs of operating the company are estimated to be $60,000 annually and the sales and marketing expenses are $20,000 a year.Additionally,the cost of materials will be $10 per shirt.What is the break-even quantity?

Accepted Answer

A)  2,000 shirts 
B)  3,200 shirts 
C)  5,334 shirts 
D)  8,000 shirts 
E)  16,000 shirts 
A)  2,000 shirts 
B)  3,200 shirts 
C)  5,334 shirts 
D)  8,000 shirts 
E)  16,000 shirts

Question 20

Figure 13-5A
-Which of the following illustrates movement along the demand curve?

Accepted Answer

A)  Prices remain the same, but there is a significant increase in demand. 
B)  Prices remain the same, but 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)  Prices remain the same, but there is a significant increase in demand. 
B)  Prices remain the same, but 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.

competitive market situation in which the few sellers are sensitive to each other's prices is referred to as

unit variable cost (UVC)equals variable cost (VC)divided by __________.

Which of the following statements about StubHub is most accurate?

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

target return profit objective implies that a company chooses to

buying situation can involve comparing the costs and benefits of substitute items-such as real sugar to the sugar substitute Splenda,which,although more expensive than sugar,is purchased by many consumers because it contains no calories.This situation involves the consumer considering

Figure 13-10A -Figure 13-10A above,"X" represents

Small regional producers selling grocery products have a special problem because they need to set prices at which both they and their channel members can profit while

Estimating demand,sales revenue,and price elasticity are issues that would be addressed during __________ of the price-setting process.

Microsoft,Sony,and Nintendo are the three principal firms in the video game console market.Using Figure 13-4,how much price competition is most likely for video game makers?

ratio of perceived benefits to __________ is referred to as value.

Shoe Co.has fixed costs of $6 million and unit variable costs of $5 per pair.Suppose a consultant tells Ace it can sell 700,000 pairs of shoes,thus earning a profit of $2.5 million.What potential error is the consultant making?

Figure 13-7 -According to Figure 13-7 above,what is the price of Newsweek when marginal revenue is $0?

Price elasticity of demand is determined by a number of factors,such as whether the item is a luxury product or service,the necessity of the product or service,the cash outlay of purchase relative to a person's disposable income,and

Figure 13-5A -Which of the following illustrates movement along the demand curve?

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Scanning the Marketing Environment

Ethical and Social Responsibility for Sustainable 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

Services Marketing

Arriving at the Final Price

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Using Social Media and Mobile Marketing to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multi-Channel Marketing

Pulling It All Together: The Strategic Marketing Process

Filters

Exam 13: Building the Price Foundation

competitive market situation in which the few sellers are sensitive to each other's prices is referred to as

unit variable cost (UVC)equals variable cost (VC)divided by __________.

Which of the following statements about StubHub is most accurate?

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

target return profit objective implies that a company chooses to

buying situation can involve comparing the costs and benefits of substitute items-such as real sugar to the sugar substitute Splenda,which,although more expensive than sugar,is purchased by many consumers because it contains no calories.This situation involves the consumer considering

Figure 13-10A -Figure 13-10A above,"X" represents

Small regional producers selling grocery products have a special problem because they need to set prices at which both they and their channel members can profit while

Estimating demand,sales revenue,and price elasticity are issues that would be addressed during __________ of the price-setting process.

Microsoft,Sony,and Nintendo are the three principal firms in the video game console market.Using Figure 13-4,how much price competition is most likely for video game makers?

ratio of perceived benefits to __________ is referred to as value.

Shoe Co.has fixed costs of $6 million and unit variable costs of $5 per pair.Suppose a consultant tells Ace it can sell 700,000 pairs of shoes,thus earning a profit of $2.5 million.What potential error is the consultant making?

Figure 13-7 -According to Figure 13-7 above,what is the price of Newsweek when marginal revenue is $0?

Price elasticity of demand is determined by a number of factors,such as whether the item is a luxury product or service,the necessity of the product or service,the cash outlay of purchase relative to a person's disposable income,and

Figure 13-5A -Which of the following illustrates movement along the demand curve?

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Scanning the Marketing Environment

Ethical and Social Responsibility for Sustainable 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

Services Marketing

Arriving at the Final Price

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Using Social Media and Mobile Marketing to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multi-Channel Marketing

Pulling It All Together: The Strategic Marketing Process

Filters