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Odd-even pricing is based on


A) retailers' perceptions of price.
B) customers' perceptions of price.
C) wholesalers' markups.
D) manufacturers' perceptions of price.
E) government regulators' perceptions of price.

F) A) and B)
G) C) and D)

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Price lining refers to


A) charging different prices to different buyers for goods of like grade and quality.
B) setting a low initial price on a new product to appeal immediately to the mass market.
C) setting a market price for a product or product class based on a subjective feel for the competitors' price or market price as the benchmark.
D) setting prices a few dollars or cents under an even number.
E) setting the price of a line of products at a number of different specific pricing points.

F) B) and C)
G) B) and E)

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Cumulative quantity discounts refers to


A) reductions in unit costs for a larger order.
B) cumulative cash payments or extra amounts of "free goods" awarded sellers in the channel of distribution for undertaking certain advertising or selling activities to promote a product.
C) discounts offered to sellers for first-time purchases of a new product as incentives for providing shelf space.
D) an accumulation of discounts for every additional rebuy in which the discount becomes incrementally higher.
E) discounts that apply to the accumulation of purchases of a product over a given time period, typically a year.

F) A) and B)
G) A) and C)

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Supermarket managers use standard markup pricing because it is particularly suited to situations when


A) there is a large number of products and estimating the demand for each would be difficult and time consuming.
B) there is a large number of product lines, all with basically the same product attributes.
C) there is a specific profit goal that needs to be achieved.
D) there is a policy of selling every item in a product line at the same price regardless of the product class.
E) the products are perishable or seasonal.

F) D) and E)
G) A) and C)

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What is standard markup pricing and when would it be used?

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Standard markup pricing entails adding a...

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The practice of offering a bargain that is conditional on the purchase of other products may exist when a buyer is offered the "1-Cent Sales," the "Buy 1, Get 1 Free," or the "Get 2 for the Price of 1" deal. Such pricing is legal only if


A) the seller is using bundle pricing.
B) there is a reasonable amount of inventory to satisfy the needs of the retailers normal traffic flow.
C) the first items are sold at the regular price, not a price inflated for the offer.
D) the product is not outdated.
E) the quantity available to the customer is not limited.

F) B) and C)
G) A) and D)

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A pricing method where all buyers pay the same delivered price for the products, regardless of their distance from the seller, is referred to as


A) single-zone pricing.
B) multiple-zone pricing.
C) freight absorption pricing.
D) FOB origin pricing.
E) basing-point pricing.

F) A) and E)
G) None of the above

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With cost-oriented approaches, a price setter stresses the cost side of the pricing problem, not the __________ side.


A) shareholder equity
B) income
C) service
D) supply
E) demand

F) All of the above
G) A) and C)

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Penetration pricing is considered to be a __________ approach to pricing.


A) demand-oriented
B) cost-oriented
C) profit-oriented
D) competition-oriented
E) service-oriented

F) All of the above
G) B) and E)

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Everyday low pricing refers to


A) the pricing strategy of "extreme value" stores to maintain high price-quality images for the products they sell.
B) the pricing strategy of starting a product at standard list price and then lowering the price by a certain percentage until it is sold.
C) short-term price reductions when consumer demand takes a significant and unexpected dip.
D) the practice of replacing promotional allowances with lower manufacturer list prices.
E) a form of predatory pricing used solely for the purpose of undercutting competitors' prices.

F) B) and D)
G) B) and C)

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The manager of a small gasoline station observes that while gasoline sales have been steady, the service side of the business has declined, and mechanics are often idle. He decides to offer a promotion-a $20 off coupon for an oil change that is to be mailed to 800 households within a two-mile radius from the gas station. The cost of printing and mailing is $1,000. The normal cost of an oil change is $40. Materials and labor per oil change costs $15. If 200 customers use the coupon, what will be the total profit of the promotion based on the profit equation?


A) -$4,000
B) -$1,000
C) $0
D) $1,000
E) $4,000

F) C) and D)
G) B) and E)

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Demand-oriented approaches weigh factors that underlie expected __________ more heavily than such factors as cost, profit, and competition when selecting a price level.


A) total revenue
B) stakeholder concerns
C) prevailing prices
D) product substitutes
E) customer tastes

F) A) and E)
G) A) and C)

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A promotional allowance is


A) a onetime discount to promote the product that must be used within a certain time frame.
B) the cash payments or an extra amount of "free goods" awarded sellers in the marketing channel for undertaking certain advertising or selling activities to promote the product.
C) the return of money to promote the product based on proof of purchase.
D) a short-term price reduction when consumer demand takes a significant and unexpected dip.
E) an incentive, such as trips, cruises, jewelry, etc., presented to brand-loyal customers.

F) B) and D)
G) C) and D)

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Deceptive pricing practices are outlawed by legislation and enforced by which federal agency?


A) Consumer Protection Agency
B) U.S. Department of Justice
C) Federal Communications Commission
D) U.S. Department of Commerce
E) Federal Trade Commission

F) A) and D)
G) A) and C)

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Toro decided to augment its traditional hardware retail distribution channel by also selling through mass merchandisers such as Walmart and Target and setting prices for its products substantially below those of its traditional hardware outlets. As a result, many hardware stores abandoned Toro products in favor of other manufacturers. This is an example of a firm failing to consider __________ effects when setting its final list or quoted price.


A) company
B) social responsibility
C) regulatory
D) competitive
E) customer

F) A) and C)
G) B) and D)

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Many cruise lines pay the customer's airfare to the point of cruise departure. What type of price adjustment are the cruise lines using?


A) skimming pricing
B) promotional pricing
C) loss-leader pricing
D) prestige pricing
E) uniform delivered pricing

F) A) and E)
G) B) and E)

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Central Ice Machine Co. is located in Omaha, Nebraska, and sells Frick, Sullair, York, and Fes Fuller ammonia refrigeration parts. The company ships these parts using FOB origin pricing. Which of the following statements about the shipment of a Frick reciprocating compressor is most accurate?


A) Central Ice Machine will pay all shipping costs.
B) Central Ice Machine splits the shipping costs with its customers regardless of where the compressor is shipped.
C) It will cost Central Ice Machine more to ship to Charlotte, North Carolina, than to Topeka, Kansas.
D) A buyer in Albany, New York, will pay significantly more shipping charges than a buyer in Lincoln, Nebraska.
E) All buyers will pay the same shipping costs, regardless of the destination.

F) A) and E)
G) D) and E)

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The pricing approach that (1) estimates the price that ultimate consumers would be willing to pay for a product; (2) works backward through markups taken by retailers and wholesalers to determine what price to charge wholesalers; and (3) results in the manufacturer deliberately adjusting the composition and features of the product to achieve the price to consumers is referred to as


A) cost-benefit pricing.
B) cost-plus percentage-of-cost pricing.
C) target pricing.
D) cost-plus fixed-fee pricing.
E) product feature pricing.

F) All of the above
G) A) and E)

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Setting prices a few dollars or cents under an even number is referred to as


A) odd-even pricing.
B) prestige pricing.
C) price lining.
D) above-, at-, or below-market pricing.
E) every day fair pricing.

F) C) and E)
G) B) and E)

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If you were to buy one peach tree and one apple tree from the Stark Bros. fruit trees and landscaping catalog in two separate orders, you would pay a total of $109.99. However, if you order the peach and apple tree together in the same order, you pay only $89.99 each. When purchasing the two trees together, what pricing strategy does Stark Bros. employ?


A) product-line pricing
B) prestige pricing
C) price lining
D) discount pricing
E) bundle pricing

F) A) and D)
G) C) and E)

Correct Answer

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Showing 181 - 200 of 358

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