Exam 16: Pricing Concepts

List the two primary determinants of price.What other factors can affect price setting?

Kables Optic builds quality binoculars with innovative components (such as water resistance)and superior durability.Kables Optic has managed to keep its price lower than its competitors.However,Kables's sales have been disappointing.For a fast and simple remedy,what should Kables do?

Concha y Toro,a Chilean wine,has reduced the price of one bottle from $10 to $8.It previously sold 420 bottles in the month prior to the price reduction,and it now sells 525 bottles per month.What is being experienced?

Which costs do not change as output is increased or decreased?

Hal Macini,owner of Evergreen Landscaping,is more interested in earning customer goodwill than striving for maximum profit.He determines his prices by maintaining the company's profitability at a level that gives him a good living but will never make him a rich man.What is Macini basing his pricing policy on?

The Canadian Girl catalogue began as a concept to introduce today's girls to girls who lived in the past.Each historically accurate doll is carefully crafted and dressed and has books to describe her life.For example,Kristen is an 1854 pioneer girl who is growing up in Manitoba.Her story begins with her long sea voyage from Iceland.The basic doll dressed in a calico dress and striped apron plus the hardcover story of how she got to Manitoba costs $90.Six more hardback books of Kristen's life are available for $74.95.Kristen's nightgown costs $20,and a matching one for the doll owner is an additional $38.Buy both together and the price is only $50.A hand-painted wooden bed and trunk for Kristen are available for $213.Shipping costs vary with the price of the merchandise ordered. -Refer to Canadian Girl Doll.In terms of producing the dolls and its accessories,the calico fabric used to make Kristen's dress is an example of which of the following?

At her local supermarket,TJ saw a pizza pan and a package of mix to make homemade pizza.The items,which were sold together,retailed at $28.50,but were marked down to $19.99. -Refer to Pizza.What is $19.99?

What is the biggest advantage associated with markup pricing?

Although many factors can influence price,what are the primary determinants?

Which of the following BEST describes extranets between suppliers and customers?

Imagine you're planning an after-symphony fund-raising party,and you need a life-size grand piano cake.Or you are a developer proposing a new shopping centre to a group of investors,and you want to serve a cake shaped like an architectural rendition of the centre.Is this impossible? No,you just need to contact Cecilia Villaveces Cakes.She actually built a life-size grand piano cake for a gala in Toronto.You can expect to pay anywhere from $75 to $10,000 for one of Cecilia's creations,depending on complexity of design and size.She uses only the best ingredients,and no two cakes are ever quite alike. -Refer to Specialty Cakes.Although many factors determine the prices charged by Cecilia Villaveces Cakes,what are the two primary determinants?

In the mid-1990s,WestJet chose to compete head-on with Air Canada by launching WestJetLite,an alternative low-fare commercial airline passenger operation.Top executives at WestJet had expected its no-frills operation to break even within a year of its inception,but the airline fell short of the goal.A source close to the company explained it by saying,"Its costs were too high,and its revenues were too low." Some observers criticized WestJetLite's marketing efforts.When the no-frills service was first launched,it lacked a distinct name or identity,missing its chance to make a splash.Then WestJet tried to sell three "brands" at once-Plush ,a new premium service,and its more traditional long-haul domestic flights.As one rival expressed it,"You cannot be all things to all people." -Refer to WestJetLite.Consumers who travelled on WestJetLite or Air Canada were very sensitive to price changes.What does this suggest?

According to the text,how is price best described?

Variable costs vary with changes in the level of output,whereas marginal costs do not vary as output changes.

Antique Reproductions pays a manufacturer $800 for a hand-forged iron fireplace screen,and it sells the fireplace screen to a customer for $1,600.What is the markup on the screen?

For convenience,pricing objectives can be divided into three categories.What are they?

What is the impact of the Internet and extranets on pricing strategies?

What is marginal revenue? Based on the provided schedule from the Chesapeake Bay Swing Company,at which quantity should Chesapeake Bay start producing additional swings? Quantity Marginal Revernue Marginal Cost Total Profit 1 260 1160 \ 200 2 110 140 270 3 190 120 340 4 170 140 370 5 160 160 370 6 150 180 340 7 120 220 240

The maintenance costs of WestJetLite's airplane storage facilities represents what type of cost?

According to the text,which of the following statements about the impact of the Internet on pricing strategy is true?