Question 1

An oligopoly is a competitive market situation where

Accepted Answer

A) many sellers follow market price for identical,commodity products. 
B) one seller sets the price for a unique product. 
C) few sellers are sensitive to one another's prices. 
D) many sellers compete on nonprice factors. 
E) one or few sellers compete solely on nonprice factors. 
A) many sellers follow market price for identical,commodity products. 
B) one seller sets the price for a unique product. 
C) few sellers are sensitive to one another's prices. 
D) many sellers compete on nonprice factors. 
E) one or few sellers compete solely on nonprice factors.

Question 2

Elastic demand exists when

Accepted Answer

A) a small percentage decrease in price produces a smaller percentage increase in quantity demanded. 
B) a small percentage decrease in price produces a larger percentage increase in quantity demanded. 
C) an increase in price causes a larger increase in quantity demanded. 
D) the quantity demanded remains the same regardless of level of price. 
E) no change in in price produces a small percentage change in quantity demanded. 
A) a small percentage decrease in price produces a smaller percentage increase in quantity demanded. 
B) a small percentage decrease in price produces a larger percentage increase in quantity demanded. 
C) an increase in price causes a larger increase in quantity demanded. 
D) the quantity demanded remains the same regardless of level of price. 
E) no change in in price produces a small percentage change in quantity demanded.

Question 3

Factors that determine consumers' willingness and ability to pay for products and services are referred to as

Accepted Answer

A) supply factors. 
B) demand factors. 
C) affordability factors. 
D) elasticity factors. 
E) macro environmental factors. 
A) supply factors. 
B) demand factors. 
C) affordability factors. 
D) elasticity factors. 
E) macro environmental factors.

Question 4

Jane Westerlund owns a picture frame store and has generated a spreadsheet of several calculations based on different quantity,price,revenue,cost,and profit scenarios shown in Figure 13-9 above.At what sales level is profit maximized?

Accepted Answer

A) 0 
B) 400 
C) 800 
D) 1,600 
E) 2,000 
A) 0 
B) 400 
C) 800 
D) 1,600 
E) 2,000

Question 5

All of the following are examples of pricing constraints EXCEPT:

Accepted Answer

A) newness of the product. 
B) competitors' prices. 
C) newness of the product (stage in its life cycle). 
D) social responsibility. 
E) demand for the product class,product,or brand. 
A) newness of the product. 
B) competitors' prices. 
C) newness of the product (stage in its life cycle). 
D) social responsibility. 
E) demand for the product class,product,or brand.

Question 6

When Pizza Hut announced it was going to add 25 percent more toppings to its Meat Lover's line of pizzas without increasing prices,what consumer motivation was it appealing to?

Accepted Answer

A) cost 
B) appearance 
C) value 
D) price 
E) quality 
A) cost 
B) appearance 
C) value 
D) price 
E) quality

Question 7

You are president of a manufacturer of small electric appliances.You want to reduce your break-even quantity.All things being equal,you can do this by

Accepted Answer

A) increasing the quantity sold,while keeping price unchanged. 
B) reducing marginal revenue. 
C) reducing unit variable cost. 
D) increasing fixed cost. 
E) increasing total cost. 
A) increasing the quantity sold,while keeping price unchanged. 
B) reducing marginal revenue. 
C) reducing unit variable cost. 
D) increasing fixed cost. 
E) increasing total cost.

Question 8

While consumer tastes and price and availability of similar products determine what consumers want to buy,consumer income determines

Accepted Answer

A) where they buy. 
B) the degree of brand loyalty. 
C) the degree of repeat buys. 
D) what they can buy. 
E) their desire to buy. 
A) where they buy. 
B) the degree of brand loyalty. 
C) the degree of repeat buys. 
D) what they can buy. 
E) their desire to buy.

Question 9

Suppose you are the owner of a picture frame store.Let's assume that the average price customers are willing to pay for each picture frame is $120.Also,suppose your fixed costs (FC)total $32,000 (real estate taxes,interest on a bank loan,etc. )and unit variable cost (UVC)for a picture frame is $40 (labor,glass,frame,and matting).Figure 13-10 above shows that by selling 200 pictures,your picture frame store will

Accepted Answer

A) break even. 
B) earn a profit. 
C) incur a loss. 
D) have no fixed costs. 
E) have no variable costs. 
A) break even. 
B) earn a profit. 
C) incur a loss. 
D) have no fixed costs. 
E) have no variable costs.

Question 10

Price refers to

Accepted Answer

A) the value assigned to the exchange of products and services for other products and services. 
B) the value judgment made by both the buyer and seller regarding an item's worth. 
C) the money or other considerations (including other products and services)exchanged for the ownership or use of a product or service. 
D) the value assessed for the benefits of using a product or service. 
E) the highest monetary value a customer is willing to pay for a product or service. 
A) the value assigned to the exchange of products and services for other products and services. 
B) the value judgment made by both the buyer and seller regarding an item's worth. 
C) the money or other considerations (including other products and services)exchanged for the ownership or use of a product or service. 
D) the value assessed for the benefits of using a product or service. 
E) the highest monetary value a customer is willing to pay for a product or service.

Question 11

Break-even analysis refers to

Accepted Answer

A) a process that investigates the difference between marginal revenue and marginal cost. 
B) a method of determining just how much a consumer is willing to pay for a product or service. 
C) a technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output. 
D) the process of determining the quantity of product consumers will buy relative to the quantity produced by the firm. 
E) the graph that shows the maximum number of products consumers will buy at a given price. 
A) a process that investigates the difference between marginal revenue and marginal cost. 
B) a method of determining just how much a consumer is willing to pay for a product or service. 
C) a technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output. 
D) the process of determining the quantity of product consumers will buy relative to the quantity produced by the firm. 
E) the graph that shows the maximum number of products consumers will buy at a given price.

Question 12

At one point,people were willing to pay hundreds of dollars on eBay for a Beanie Baby toy that originally cost a fraction of that amount.Today,those same Beanie Babies can be found at garage sales all over the country for a less than a dollar apiece.This is MOST LIKELY due to

Accepted Answer

A) faulty craftsmanship in later production batches. 
B) a sharp downturn in the economy. 
C) the new,more nostalgic fad of bobble-head dolls. 
D) too many counterfeit Beanie Babies entering the country. 
E) a product becoming a fad and then losing its fad appeal. 
A) faulty craftsmanship in later production batches. 
B) a sharp downturn in the economy. 
C) the new,more nostalgic fad of bobble-head dolls. 
D) too many counterfeit Beanie Babies entering the country. 
E) a product becoming a fad and then losing its fad appeal.

Question 13

What are the six major steps involved in setting prices?

Accepted Answer

Step 1: Identify pricing objectives and

Question 14

With consumers having great opportunities to compare prices on the Internet,they can make more __________ buying decisions.

Accepted Answer

A) efficient 
B) profitable 
C) effective 
D) relative 
E) affective 
A) efficient 
B) profitable 
C) effective 
D) relative 
E) affective

Question 15

The practice of simultaneously increasing product and service benefits while maintaining or decreasing price is referred to as __________.

Accepted Answer

A) value-pricing 
B) customer-value pricing 
C) competitive pricing 
D) cost pricing 
E) demand pricing 
A) value-pricing 
B) customer-value pricing 
C) competitive pricing 
D) cost pricing 
E) demand pricing

Question 16

Marginal revenue refers to

Accepted Answer

A) the additional money required to produce one additional unit. 
B) the least number of units sold to cover product,distribution,and promotional costs. 
C) the amount by which marginal costs exceed variable costs. 
D) the change in total revenue that results from producing and marketing one additional unit of the product. 
E) the net gain in revenue if unit prices are lowered. 
A) the additional money required to produce one additional unit. 
B) the least number of units sold to cover product,distribution,and promotional costs. 
C) the amount by which marginal costs exceed variable costs. 
D) the change in total revenue that results from producing and marketing one additional unit of the product. 
E) the net gain in revenue if unit prices are lowered.

Question 17

Creative marketers engage in value-pricing,which is the practice of simultaneously __________ while maintaining or decreasing price.

Accepted Answer

A) decreasing product and service benefits 
B) increasing product and service benefits 
C) decreasing profit 
D) analyzing benefits 
E) decreasing cost 
A) decreasing product and service benefits 
B) increasing product and service benefits 
C) decreasing profit 
D) analyzing benefits 
E) decreasing cost

Question 18

What is the difference between fixed costs and variable costs?

Accepted Answer

Fixed cost is the sum of the expenses of

Question 19

Suppose you are the owner of a picture frame store and you wish to calculate how many pictures you must sell to cover your fixed and variable costs at a given price.Let's assume that the demand for your pictures is strong,so the average price customers are willing to pay for each picture frame is $120.Also,suppose your fixed costs (FC)total $32,000 (real estate taxes,interest on a bank loan,etc. )and unit variable cost (UVC)for a picture frame is $40 (labor,glass,frame,and matting).If your picture frame store sold 2,000 picture frames,what would your profit (or loss)be?

Accepted Answer

A) a loss of $32,000 
B) $0-just able to break-even 
C) $32,000 profit 
D) $112,000 profit 
E) $128,000 profit 
A) a loss of $32,000 
B) $0-just able to break-even 
C) $32,000 profit 
D) $112,000 profit 
E) $128,000 profit

Question 20

Suppose you are the owner of a picture frame store.Let's assume that the average price customers are willing to pay for each picture frame is $120.Also,suppose your fixed costs (FC)total $32,000 (real estate taxes,interest on a bank loan,etc. )and unit variable cost (UVC)for a picture frame is $40 (labor,glass,frame,and matting).According to Figure 13-10 above,how much profit will your picture frame store make if it sells 400 picture frames?

Accepted Answer

A) $48,000 
B) $32,000 
C) $16,000 
D) $0 
E) ($32,000) 
A) $48,000 
B) $32,000 
C) $16,000 
D) $0 
E) ($32,000)

Exam 13: Building the Price Foundation

An oligopoly is a competitive market situation where

Elastic demand exists when

Factors that determine consumers' willingness and ability to pay for products and services are referred to as

Jane Westerlund owns a picture frame store and has generated a spreadsheet of several calculations based on different quantity,price,revenue,cost,and profit scenarios shown in Figure 13-9 above.At what sales level is profit maximized?

All of the following are examples of pricing constraints EXCEPT:

When Pizza Hut announced it was going to add 25 percent more toppings to its Meat Lover's line of pizzas without increasing prices,what consumer motivation was it appealing to?

You are president of a manufacturer of small electric appliances.You want to reduce your break-even quantity.All things being equal,you can do this by

While consumer tastes and price and availability of similar products determine what consumers want to buy,consumer income determines

Price refers to

Break-even analysis refers to

At one point,people were willing to pay hundreds of dollars on eBay for a Beanie Baby toy that originally cost a fraction of that amount.Today,those same Beanie Babies can be found at garage sales all over the country for a less than a dollar apiece.This is MOST LIKELY due to

What are the six major steps involved in setting prices?

With consumers having great opportunities to compare prices on the Internet,they can make more __________ buying decisions.

The practice of simultaneously increasing product and service benefits while maintaining or decreasing price is referred to as __________.

Marginal revenue refers to

Creative marketers engage in value-pricing,which is the practice of simultaneously __________ while maintaining or decreasing price.

What is the difference between fixed costs and variable costs?

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing 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

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 to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multichannel Marketing

Pulling It All Together: the Strategic Marketing Process

Building an Effective Marketing Plan

Financial Aspects of Marketing

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