Exam 20: Setting Prices

Scenario 20.1 Use the following to answer the questions.Suppose that Ray-Ban is considering a new line of sunglasses that would be sold in major department stores. The new line would be positioned as a more distinctive brand than the typical glasses sold through department stores, and would be priced higher than other brands in the store, but a lower price line than the current Ray-Ban lines that are sold through more selective stores. In determining the price for this sunglass line, Ray-Ban wants to gather information about all brands sold in department stores and about customers' perceptions of those brands. -Refer to Scenario 20.1. If Ray-Ban selected the prices for its new sunglasses to be $60, $70, or $80, this would most likely be an example of using ____ pricing to enhance its distinctive positioning strategy.

A market share objective

Scenario 20.1 Use the following to answer the questions.Suppose that Ray-Ban is considering a new line of sunglasses that would be sold in major department stores. The new line would be positioned as a more distinctive brand than the typical glasses sold through department stores, and would be priced higher than other brands in the store, but a lower price line than the current Ray-Ban lines that are sold through more selective stores. In determining the price for this sunglass line, Ray-Ban wants to gather information about all brands sold in department stores and about customers' perceptions of those brands. -Refer to Scenario 20.1. Ray-Ban has decided to promote the new sunglass line as an "affordable luxury" and plans significant promotional expenditures. With these objectives, which of the following should Ray-Ban use to price its product line?

Nabisco is considering two pricing objectives. The first is to sell one out of every three crackers consumed in the world, an objective based on _______; the second is to meet, but not beat, competitor's prices of cookie products, which is a _____ objective.

It is usually easy to obtain an accurate price list for a competitor's products.

The decision of Macy's to use even prices such as $60 for a Ralph Lauren Polo is an application of ____; where ____ prices are often used to _____.

How are pricing objectives similar to a corporation's overall goals? How are they different?

Which of the following statements about markup pricing is correct?

Amtrak is considering two pricing strategies for its service. One is to price its train tickets so that it is less expensive to travel on weekends than during the week when there is heavy business travel, which illustrates ____ pricing. The second is to price its train tickets so that the further away the travel date, the greater the discount, which is best described as ___

Grocery stores that position their less expensive, private brands next to more expensive, well-known manufacturer brands on the shelf are using the concept of reference pricing.

When products in an industry are relatively homogeneous and price is a key purchase consideration,

The federal government often uses ____ pricing when it grants defense contracts.

Identify and describe the four types of product-line pricing.

Westin Hotels, Inc. has an objective of achieving a 25 percent return from its overall sales. This is an example of a ____ pricing objective.

A Macy's manager designs the casual clothing department such that one of Macy's private label pairs of jeans, priced at $24.99, is positioned next to a national brand of jeans, such as Levis, priced at $39.99. What is the manager attempting to accomplish?

You are the marketing manager for a multi-state auto dealership in the Southeast United States. It is that time of year when your fleet of autos goes through a major model year change. You are putting the final touches on your pricing strategy to facilitate this change in your inventory of autos.Which of the following pricing strategies will you use to facilitate this model year change? ​

The six stages of setting prices should always be followed if prices are to be set correctly.

Cost-based pricing results in a high price when demand is high and a low price when demand is low.

Penetration pricing is one new-product pricing approach that provides the most flexible introductory price.

When Sharp first introduced its line of graphing calculators, it set the price quite high; it has lowered the price as competitors have entered the market. The pricing strategy initially used by Sharp is called