Question 1

Which of the following is a particular type of price?

Accepted Answer

A)  operating costs
B)  liquidity
C)  equitable medium
D)  college tuition
E)  stockholders' equityF) B) and E)
G) B) and D)

Question 2

Promotional allowance refers to

Accepted Answer

A)  one-time discounts that must be used within a certain time frame or they become null and void.
B)  the cash payments or an extra amount of "free goods" awarded sellers in the channel of distribution for undertaking certain advertising or selling activities to promote the product quantity discounts that are incentives for placing new products such as obtaining shelf-space at a supermarket.
C)  complementary products given for free as a gesture of "good will" for retailers providing shelf space for new or untried products.
D)  short-term price reductions when consumer demand takes a significant and unexpected dip.
E)  incentives such as trips, cruises, jewelry, and even automobiles, presented to large-order customers for their loyalty.F) C) and D)
G) A) and B)

Question 3

Washburn sell their guitars through a number of channels such as chains and online dealers, but they feel it is their independent dealers who sell the guitar for them.In recognition of their hard work, Washburn takes a smaller profit margin from them because they have to do more work.In essence, this special adjustment to the list price or quoted price is an example of a(n)

Accepted Answer

A)  Quantity discount.
B)  Seasonal discount.
C)  Trade discount.
D)  Cash discount.
E)  Promotional allowance.F) A) and E)
G) A) and D)

Question 4

For years a local "greasy spoon" diner had customers lining up around the building for breakfast.When the city announced that it was building an off ramp from the highway that would conceivably double his customer traffic he was delighted.Having saved enough in previous years, he was certain it could hold him over through the three month construction.Unfortunately; construction delays continued for an additional six months and the work is still ongoing.The best pricing objective at this point would most likely be _________.

Accepted Answer

A)  profit
B)  market share
C)  unit volume
D)  survival
E)  social responsibilityF) B) and C)
G) B) and E)

Question 5

A negative aspect of selecting unit volume as a pricing objective is that

Accepted Answer

A)  production can often not keep up with demand.
B)  there are increased carrying costs with extensive inventories.
C)  if price reductions are used to achieve volume objectives it can sometimes come at the expense of profits.
D)  it can create competition between divisions within the organization itself causing conflicts over the allocation of resources.
E)  the number of units that need to be sold in order to avoid carrying more than minimal inventory.F) None of the above
G) B) and C)

Question 6

Consumers buy water and soda from vending machines.Traditionally, the price of each of these products is about $1.00.If a marketer charges a significantly higher price for such products dispensed by vending machines, sales are likely to decline.In order to avoid such declines in sales, marketers tend to be very consistent in the price charged for vending machine products.This is an example of marketers employing a __________ strategy.

Accepted Answer

A)  below-market pricing
B)  skimming pricing
C)  penetration pricing
D)  customary pricing
E)  loss-leader pricingF) A) and C)
G) C) and D)

Question 7

Which of the following is a typical example of a fixed cost?

Accepted Answer

A)  taxes
B)  building rental expense
C)  raw materials
D)  sales commissions
E)  hourly wagesF) C) and E)
G) A) and E)

Question 8

The pricing strategy that is almost the exact opposite of skimming prices is

Accepted Answer

A)  price lining.
B)  target pricing.
C)  prestige pricing.
D)  odd-even pricing.
E)  penetration pricing.F) A) and B)
G) A) and C)

Question 9

To reward wholesalers and retailers for the risk they accept in assuming increased inventory carrying costs, manufacturers offer

Accepted Answer

A)  noncumulative discounts.
B)  cumulative discounts.
C)  functional discounts.
D)  seasonal discounts.
E)  trade discounts.F) None of the above
G) B) and C)

Question 10

Explain why price elasticity is important to marketing managers.

Accepted Answer

Price elasticity of demand is important ...

Question 11

Summing the total unit cost of providing a product or service and adding a specific amount to the cost to arrive at the price is referred to as _________.

Accepted Answer

A)  standard markup pricing
B)  experience curve pricing
C)  cost-plus pricing
D)  product-line pricing
E)  target return-on-investment pricingF) B) and D)
G) C) and E)

Question 12

To increase value marketers may increase benefits, decrease price, or _________.

Accepted Answer

A)  decrease benefits and increase price
B)  decrease both price and benefits
C)  both increase benefits and decrease price
D)  decrease price and decrease benefits
E)  do nothing and let the perceived value of the item increase as it matures in the life cycleF) A) and C)
G) A) and B)

Question 13

A target return profit objective implies that a company chooses

Accepted Answer

A)  to set targets whose performance can be measured quickly such as by quarter or year.
B)  to give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets.
C)  to set a profit goal that is often determined by its board of directors.
D)  to reduce as many non-essential costs as possible and forego investing in any further market or product research.
E)  base prices on a marginal return on investment.F) None of the above
G) A) and B)

Question 14

Which of the following pricing techniques is the result of manufacturers deliberately adjusting the composition and features of a product to achieve the target price to consumers?

Accepted Answer

A)  cost-plus percentage-of-cost pricing
B)  standard markup pricing
C)  cost-plus fixed-fee pricing
D)  experience curve pricing
E)  target pricingF) A) and B)
G) A) and C)

Question 15

Companies often pursue a market share objective when _________.

Accepted Answer

A)  industry sales are flat or declining
B)  industry profits are increasing
C)  industry sales are beginning to rise
D)  when there is a sudden increase in production costs
E)  when stockholders are seeking higher dividendsF) A) and B)
G) A) and C)

Question 16

The maximum quantity of products consumers will buy at a given price is shown by

Accepted Answer

A)  a demand curve.
B)  a price constraint.
C)  a break-even point.
D)  price lining.
E)  a marginal revenue curve.F) B) and E)
G) All of the above

Question 17

Target return-on-investment pricing refers to

Accepted Answer

A)  setting the price of a line of products at a number of different price points.
B)  adding a fixed percentage to the cost of all items in a specific product class.
C)  setting prices to achieve a profit that is a specified percentage of the sales volume.
D)  setting a price to achieve an annual target return-on-investment (ROI) .
E)  setting a price oriented on an annual specific dollar target volume of profit.F) A) and D)
G) B) and E)

Question 18

The practice of charging different prices to different buyers for goods of like grade and quality is referred to as

Accepted Answer

A)  horizontal price-fixing.
B)  resale price maintenance.
C)  price discrimination.
D)  predatory pricing.
E)  bait-and-switch pricing.F) A) and C)
G) A) and D)

Question 19

Variable cost refers to the

Accepted Answer

A)  the sum of the expenses of the firm that are stable and do not change with the quantity of a product that is produced and sold.
B)  the sum of the expenses of the firm that vary directly with the quantity of a product that is produced and sold.
C)  the expense incurred by a firm in producing and marketing a product is referred to as overhead.
D)  the average amount of money received for selling one unit of a product or simply the price of that unit.
E)  the sum of the expenses of the firm deducted from the revenue generated by the sale of the product.F) B) and C)
G) A) and B)

Question 20

For most products, it is difficult to identify a specific market price for a product or product class.Still, marketing managers often have a subjective feel for the competitors' price or market price.Using this benchmark, they then may deliberately choose a strategy of

Accepted Answer

A)  above-, at-, or below-market pricing.
B)  loss-leader pricing.
C)  penetration pricing.
D)  bundle pricing.
E)  experience curve pricing.F) A) and B)
G) B) and C)

Exam 12: Pricing Products and Services

The maximum quantity of products consumers will buy at a given price is shown by

Correct Answer
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Summing the total unit cost of providing a product or service and adding a specific amount to the cost to arrive at the price is referred to as _________.

Correct Answer
verified

Variable cost refers to the

Correct Answer
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The pricing strategy that is almost the exact opposite of skimming prices is

Correct Answer
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Correct Answer
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A target return profit objective implies that a company chooses

Correct Answer
verified

Correct Answer
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Target return-on-investment pricing refers to

Correct Answer
verified

Companies often pursue a market share objective when _________.

Correct Answer
verified

Which of the following pricing techniques is the result of manufacturers deliberately adjusting the composition and features of a product to achieve the target price to consumers?

Correct Answer
verified

For most products, it is difficult to identify a specific market price for a product or product class.Still, marketing managers often have a subjective feel for the competitors' price or market price.Using this benchmark, they then may deliberately choose a strategy of

Correct Answer
verified

To reward wholesalers and retailers for the risk they accept in assuming increased inventory carrying costs, manufacturers offer

Correct Answer
verified

To increase value marketers may increase benefits, decrease price, or _________.

Correct Answer
verified

The practice of charging different prices to different buyers for goods of like grade and quality is referred to as

Correct Answer
verified

Promotional allowance refers to

Correct Answer
verified

A negative aspect of selecting unit volume as a pricing objective is that

Correct Answer
verified

Which of the following is a typical example of a fixed cost?

Correct Answer
verified

Explain why price elasticity is important to marketing managers.

Correct Answer
verified
Price elasticity of demand is important ...
View Answer

Which of the following is a particular type of price?

Correct Answer
verified

Correct Answer
verified

Exam 12: Pricing Products and Services

The maximum quantity of products consumers will buy at a given price is shown by

Correct AnswerverifiedShow Answer

Summing the total unit cost of providing a product or service and adding a specific amount to the cost to arrive at the price is referred to as _________.

Correct AnswerverifiedShow Answer

Variable cost refers to the

Correct AnswerverifiedShow Answer

The pricing strategy that is almost the exact opposite of skimming prices is

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A target return profit objective implies that a company chooses

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Target return-on-investment pricing refers to

Correct AnswerverifiedShow Answer

Companies often pursue a market share objective when _________.

Correct AnswerverifiedShow Answer

Which of the following pricing techniques is the result of manufacturers deliberately adjusting the composition and features of a product to achieve the target price to consumers?

Correct AnswerverifiedShow Answer

For most products, it is difficult to identify a specific market price for a product or product class.Still, marketing managers often have a subjective feel for the competitors' price or market price.Using this benchmark, they then may deliberately choose a strategy of

Correct AnswerverifiedShow Answer

To reward wholesalers and retailers for the risk they accept in assuming increased inventory carrying costs, manufacturers offer

Correct AnswerverifiedShow Answer

To increase value marketers may increase benefits, decrease price, or _________.

Correct AnswerverifiedShow Answer

The practice of charging different prices to different buyers for goods of like grade and quality is referred to as

Correct AnswerverifiedShow Answer

Promotional allowance refers to

Correct AnswerverifiedShow Answer

A negative aspect of selecting unit volume as a pricing objective is that

Correct AnswerverifiedShow Answer

Which of the following is a typical example of a fixed cost?

Correct AnswerverifiedShow Answer

Explain why price elasticity is important to marketing managers.

Correct AnswerverifiedPrice elasticity of demand is important ...View AnswerShow Answer

Which of the following is a particular type of price?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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Price elasticity of demand is important ...
View Answer

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