Question 1

An increasing number of companies are basing their prices on the customer's perceived value.Explain the concept of "perceived value" and identify the key to pricing in this manner.

Accepted Answer

The answer of An increasing number of companies are basing...

Question 2

A major circumstance provoking price increases is ________.

Accepted Answer

A)  market demand 
B)  profitability versus target 
C)  cost inflation 
D)  price versus competition 
E)  stock price versus target price

Question 3

The popularity of "early-bird" specials at restaurants is an example of what type of price discrimination

Accepted Answer

A)  Time pricing 
B)  Channel pricing 
C)  Image pricing 
D)  Product-form pricing 
E)  Customer-segment pricing

Question 4

Although consumers may have fairly good knowledge of the range of prices involved,very few can accurately recall specific prices of products.

Accepted Answer

A) True 
 B)False

Question 5

The key to effectively using perceived-value pricing is always to deliver the same or equal value as your competitors.

Accepted Answer

A) True 
 B)False

Question 6

The price a firm charges for its product does not affect where it chooses to position the product in the marketplace.

Accepted Answer

A) True 
 B)False

Question 7

When is price discrimination legal

Accepted Answer

The answer of When is price discrimination legal
...

Question 8

What is market skimming and where might you see market-skimming pricing practiced in consumer goods

Accepted Answer

The answer of What is market skimming and where might...

Question 9

Texas Instruments builds a large plant to produce a great quantity of products,hoping that as prices decline,sales volume increases and thus costs decline.This market-penetration pricing is dependent upon three conditions existing in the marketplace.Which one of the following is NOT one of these conditions

Accepted Answer

A)  Low price discourages competition from entering the market. 
B)  Production and distribution costs actually fall with increases in production. 
C)  Low prices does not increase consumer demand but increases retailer competition. 
D)  The market is stimulated by lower prices. 
E)  The market is highly price sensitive.

Question 10

In target-return pricing,the firm determines the markup required and adds that amount to the fixed cost of the product.

Accepted Answer

A) True 
 B)False

Question 11

Consumers often rank brands according to price tiers in a category.

Accepted Answer

A) True 
 B)False

Question 12

Companies pursue survival as their major objective if they are plagued with ________.

Accepted Answer

A)  legal prosecution 
B)  weak competition 
C)  static consumer wants 
D)  shareholder activism 
E)  overcapacity

Question 13

The price elasticity of demand rarely varies between the short and long term.

Accepted Answer

A) True 
 B)False

Question 14

In ________ pricing,the company decides how to price its products to different customers in different locations and countries.

Accepted Answer

A)  specialty 
B)  geographical 
C)  offset 
D)  regional 
E)  none of the above

Question 15

Prior research has shown that although consumers may have fairly good knowledge of the range of prices involved,surprisingly few can recall specific prices of products accurately.When examining products,consumers often employ reference prices.List the possible prices consumers use as their "reference."

Accepted Answer

The answer of Prior research has shown that although consumers...

Question 16

Research has shown that consumers tend to process prices in a "left-to-right" manner rather than by rounding.With this knowledge,which of the following prices would seem to be a better physiological price

Accepted Answer

A)  $101.99 
B)  $109.50 
C)  $99.99 
D)  $100.00 
E)  none of the above

Question 17

________ sets a ceiling on the price the company can charge for its products.

Accepted Answer

A)  Government regulations 
B)  Market forces 
C)  Costs 
D)  Demand 
E)  Competition

Question 18

Auction-type pricing is becoming very popular due to the Internet.The three types of auction pricing include sealed-bid auctions,descending bids auctions,and ________.

Accepted Answer

A)  EDLP auctions 
B)  ascending bid auctions 
C)  high-low bid auctions 
D)  going-rate bidding auctions 
E)  value pricing auctions

Question 19

A firm first decides where it wants to position its market offering.A company can pursue any of five major objectives through pricing.Which of the following is NOT one of these objectives

Accepted Answer

A)  Predatory pricing 
B)  Survival 
C)  Maximum current profit 
D)  Maximum market share 
E)  Product-quality leadership

Question 20

The last price paid,competitors' prices,and the expected future price all serve as customer ________.

Accepted Answer

A)  given prices 
B)  odd prices 
C)  reference prices 
D)  price-quality inferences 
E)  market skimmings

Exam 14: Developing Pricing Strategies and Programs

An increasing number of companies are basing their prices on the customer's perceived value.Explain the concept of "perceived value" and identify the key to pricing in this manner.

A major circumstance provoking price increases is ________.

The popularity of "early-bird" specials at restaurants is an example of what type of price discrimination

Although consumers may have fairly good knowledge of the range of prices involved,very few can accurately recall specific prices of products.

The key to effectively using perceived-value pricing is always to deliver the same or equal value as your competitors.

The price a firm charges for its product does not affect where it chooses to position the product in the marketplace.

When is price discrimination legal

What is market skimming and where might you see market-skimming pricing practiced in consumer goods

In target-return pricing,the firm determines the markup required and adds that amount to the fixed cost of the product.

Consumers often rank brands according to price tiers in a category.

Companies pursue survival as their major objective if they are plagued with ________.

The price elasticity of demand rarely varies between the short and long term.

In ________ pricing,the company decides how to price its products to different customers in different locations and countries.

Research has shown that consumers tend to process prices in a "left-to-right" manner rather than by rounding.With this knowledge,which of the following prices would seem to be a better physiological price

________ sets a ceiling on the price the company can charge for its products.

Auction-type pricing is becoming very popular due to the Internet.The three types of auction pricing include sealed-bid auctions,descending bids auctions,and ________.

A firm first decides where it wants to position its market offering.A company can pursue any of five major objectives through pricing.Which of the following is NOT one of these objectives

The last price paid,competitors' prices,and the expected future price all serve as customer ________.