Question 1

What are the four distinct categories of non-monetary costs?

Accepted Answer

Time costs,physical costs,psychological costs,and sensory costs.

Question 2

Firms that are always reacting to competitors' price changes run the risk of pricing higher than might really be necessary.

Accepted Answer

A) True 
 B)False  False

Question 3

Pricing is less complex in services than it is in manufacturing.

Accepted Answer

A) True 
 B)False  False

Question 4

Discuss how service firms can minimize non-monetary purchase costs.

Accepted Answer

The answer of Discuss how service firms can minimize non-monetary...

Question 5

Which of the following is NOT an objective for service pricing?

Accepted Answer

A)  Build supply.
B)  Build demand.
C)  Seek profit.
D)  Cover costs.
E)  Build a user base.

Question 6

How can firms have revenue management practices and yet still have customer satisfaction,trust and good will?

Accepted Answer

The answer of How can firms have revenue management practices...

Question 7

Which of the following is NOT listed in the chapter as a firm that uses online reverse auctions?

Accepted Answer

A)  Priceline.com
B)  Hotwire.com
C)  eBay.com
D)  Lowestfare.com
E)  All of the above use online reverse auctions.

Question 8

Give an example of a tradeoff between monetary and non-monetary costs associated with patronizing a dental clinic.

Accepted Answer

The answer of Give an example of a tradeoff between...

Question 9

Describe the concept of price elasticity and draw a graph comparing consumers with high and low elasticity.

Accepted Answer

The answer of Describe the concept of price elasticity and...

Question 10

Yield management computers can determine who is likely to not show up or take other flights.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is the best example of a service industry that utilizes price complexity?

Accepted Answer

A)  Fast food
B)  Education
C)  Cellular phone
D)  Moving/transportation
E)  Roofing

Question 12

____________ is defined as the sum of all the perceived benefits minus the sum of all the perceived costs of service.

Accepted Answer

A)  Net value
B)  Consumer surplus
C)  Gross value
D)  Moderate value
E)  Consumer demand

Question 13

Discuss how a health club could strategically manage capacity via payment schedules.

Accepted Answer

The answer of Discuss how a health club could strategically...

Question 14

The amount of seats reserved for each class of American Airlines passengers on a flight is referred to as a ____________.

Accepted Answer

A)  field
B)  row
C)  column
D)  bucket
E)  gamble

Question 15

Relate fairness perceptions to DVD rental late fees.

Accepted Answer

The answer of Relate fairness perceptions to DVD rental late...

Question 16

Give an example of a service firm that uses service recovery to compensate for overbooking and discuss how the firm compensates.

Accepted Answer

The answer of Give an example of a service firm...

Question 17

Firms do not need to consider post-purchase costs,as they occur after the firm has already secured a purchase.

Accepted Answer

A) True 
 B)False

Question 18

Amazon.com is a good example of a firm that aggravated its customers with dynamic pricing.

Accepted Answer

A) True 
 B)False

Question 19

Shopbots help consumers combat dynamic pricing online.

Accepted Answer

A) True 
 B)False

Question 20

Customers will often pay more for services than they think they are worth.

Accepted Answer

A) True 
 B)False

Exam 6: Setting Prices and Implementing Revenue Management

What are the four distinct categories of non-monetary costs?

Firms that are always reacting to competitors' price changes run the risk of pricing higher than might really be necessary.

Pricing is less complex in services than it is in manufacturing.

Discuss how service firms can minimize non-monetary purchase costs.

Which of the following is NOT an objective for service pricing?

How can firms have revenue management practices and yet still have customer satisfaction,trust and good will?

Which of the following is NOT listed in the chapter as a firm that uses online reverse auctions?

Give an example of a tradeoff between monetary and non-monetary costs associated with patronizing a dental clinic.

Describe the concept of price elasticity and draw a graph comparing consumers with high and low elasticity.

Yield management computers can determine who is likely to not show up or take other flights.

Which of the following is the best example of a service industry that utilizes price complexity?

____________ is defined as the sum of all the perceived benefits minus the sum of all the perceived costs of service.

Discuss how a health club could strategically manage capacity via payment schedules.

The amount of seats reserved for each class of American Airlines passengers on a flight is referred to as a ____________.

Relate fairness perceptions to DVD rental late fees.

Give an example of a service firm that uses service recovery to compensate for overbooking and discuss how the firm compensates.

Firms do not need to consider post-purchase costs,as they occur after the firm has already secured a purchase.

Amazon.com is a good example of a firm that aggravated its customers with dynamic pricing.

Shopbots help consumers combat dynamic pricing online.

Customers will often pay more for services than they think they are worth.