Question 1

Which of the following statements regarding cost-oriented approaches is most accurate?

Accepted Answer

A)  These methods focus on the demand side of the pricing problem.
B)  These methods focus on production and marketing expenses.
C)  Target return on investment is an example of a cost-oriented method.
D)  Experience curve pricing is simple to use because costs predictably decrease by 25 percent with each doubling of production.
E)  Cost-oriented approaches are a subcategory of competition-oriented methods.F) D) and E)
G) A) and B)

Question 2

The manufacturer of a new kind of fat-free ice cream that has the consistency and taste of regular ice cream is thinking of using a penetration pricing strategy for its new product. Which of the following conditions would argue AGAINST using a penetration pricing strategy for the tasty dessert treat?

Accepted Answer

A)  The ice cream market is highly conservative.
B)  Economies of scale in production would be substantial.
C)  Retailers are not willing to carry new brands of ice cream in the already overcrowded category.
D)  Once the initial price is set, it is nearly impossible to lower the price without alienating early buyers.
E)  The ice cream market exhibits inelastic demand over a fairly broad range of prices.F) A) and C)
G) None of the above

Question 3

Customary pricing refers to

Accepted Answer

A)  a pricing method where the price the seller quotes includes all transportation costs.
B)  setting the same price for similar customers who buy the same product and quantities under the same conditions.
C)  deliberately selling a product below its list price to attract attention to it.
D)  setting a price that is dictated by tradition, a standardized channel of distribution, or other competitive factors.
E)  pricing based on what the market will bear.F) C) and D)
G) B) and E)

Question 4

After setting an approximate price level, the marketer proceeds to which step of the price-setting process?

Accepted Answer

A)  Defining the scope of the product
B)  Seeking regulatory affirmation for the price point
C)  Setting the list or quoted price
D)  Evaluating the success of the price strategy
E)  Making special adjustments to the list priceF) B) and E)
G) A) and B)

Question 5

Which of the following companies would be most likely to use target return-on-investment pricing?

Accepted Answer

A)  a farmer
B)  a florist shop
C)  a book publisher
D)  a veterinarian
E)  an automobile manufacturerF) A) and D)
G) B) and E)

Question 6

According to the price equation, final price equals list price minus __________ plus extra fees.

Accepted Answer

A)  profits
B)  commissions
C)  trade-ins
D)  taxes
E)  incentives and allowancesF) C) and E)
G) A) and C)

Question 7

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 in the same order, you pay only $89.99. When selling the two trees together for a reduced price, what pricing strategy does Stark Bros. employ?

Accepted Answer

A)  product line pricing
B)  prestige pricing
C)  price lining
D)  discount pricing
E)  bundle pricingF) A) and D)
G) B) and E)

Question 8

Functional discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

Accepted Answer

A)  the size of the order.
B)  the frequency of the order.
C)  when orders are placed during the year.
D)  the length of the relationship with the manufacturer.
E)  the marketing activities they are expected to perform in the futureF) A) and E)
G) A) and D)

Question 9

-In Figure 11-6 above, which is a break-even chart that depicts a graphic presentation of a break-even analysis for a picture frame store, the triangular area GAF represents the firm's

Accepted Answer

A)  fixed costs.
B)  break-even point.
C)  variable costs.
D)  profit.
E)  total revenueF) None of the above
G) A) and E)

Question 10

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

Accepted Answer

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

Question 11

-Figure 11-2 above represents the four approaches to selecting an appropriate price level. Box D includes customary and loss leader so it represents which approach?

Accepted Answer

A)  competition-oriented approach
B)  cost-oriented approach
C)  profit-oriented approach
D)  results-oriented approach
E)  demand-oriented approachF) A) and B)
G) B) and D)

Question 12

All of the following are competition-oriented approaches to selecting an approximate price level EXCEPT:

Accepted Answer

A)  loss leader pricing.
B)  customary pricing.
C)  above-market pricing.
D)  skimming.
E)  at-market pricing.F) A) and E)
G) A) and D)

Question 13

Using __________, many retailers deliberately sell products below their normal prices (and sometimes below cost)  to attract attention and additional store traffic.

Accepted Answer

A)  customary pricing
B)  below-market pricing
C)  prestige pricing
D)  penetration pricing
E)  loss-leader pricingF) B) and E)
G) None of the above

Question 14

Managing for long-run profits as a pricing objective implies that a company will

Accepted Answer

A)  give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets.
B)  maintain a given price range to ensure there is no loss of customers over time, even if the profit margin declines.
C)  invest excess cash in bonds and certificates of deposit in order to counteract any inflationary economic changes in the future.
D)  reinvest all profits into market or product research rather than returned to shareholders.
E)  drop all products, product lines, or divisions that cannot maintain their pricing goals.F) A) and E)
G) B) and D)

Question 15

Manufacturers of generic brands use which method of competition-oriented pricing?

Accepted Answer

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

Question 16

The __________ of a product is what customers are generally willing to pay, and is sometimes used as a benchmark for pricing.

Accepted Answer

A)  customary price
B)  asking price
C)  target price
D)  discount price
E)  market priceF) D) and E)
G) C) and D)

Question 17

A firm's profit objective is often measured in terms of ROA. The acronym ROA stands for __________.

Accepted Answer

A)  return on assets
B)  risk opportunity assessment
C)  return of allowances
D)  return on average equity
E)  risk opportunity analysisF) B) and E)
G) B) and D)

Question 18

Quantity discounts refer to

Accepted Answer

A)  price reductions in unit costs for placing a larger order.
B)  price reductions for placing long-term pre-scheduled orders.
C)  price reductions to encourage retailers to stock inventory earlier than their normal demand would require.
D)  reductions that are offered for paying bills early.
E)  reductions in unit costs for taking merchandise that will soon be replaced by new and improved versions of the original product.F) C) and D)
G) All of the above

Question 19

What are the four kinds of discounts that are especially important in marketing pricing strategy?

Accepted Answer

Discounts are reductions from list price...

Question 20

Tendollars.com offers thousands of gifts, all priced at $10. This is an example of a(n)  __________.

Accepted Answer

A)  skimming pricing approach
B)  loss-leader pricing approach
C)  one-price policy
D)  penetration pricing approach
E)  everyday low pricing approachF) A) and E)
G) A) and D)

Exam 11: Pricing Products and Services

Using __________, many retailers deliberately sell products below their normal prices (and sometimes below cost) to attract attention and additional store traffic.

Correct Answer
verified

Functional discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

Correct Answer
verified

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

Correct Answer
verified

Quantity discounts refer to

Correct Answer
verified

Correct Answer
verified

All of the following are competition-oriented approaches to selecting an approximate price level EXCEPT:

Correct Answer
verified

-Figure 11-2 above represents the four approaches to selecting an appropriate price level. Box D includes customary and loss leader so it represents which approach?

Correct Answer
verified

According to the price equation, final price equals list price minus __________ plus extra fees.

Correct Answer
verified

Which of the following statements regarding cost-oriented approaches is most accurate?

Correct Answer
verified

Which of the following companies would be most likely to use target return-on-investment pricing?

Correct Answer
verified

After setting an approximate price level, the marketer proceeds to which step of the price-setting process?

Correct Answer
verified

-In Figure 11-6 above, which is a break-even chart that depicts a graphic presentation of a break-even analysis for a picture frame store, the triangular area GAF represents the firm's

Correct Answer
verified

Manufacturers of generic brands use which method of competition-oriented pricing?

Correct Answer
verified

Correct Answer
verified

Managing for long-run profits as a pricing objective implies that a company will

Correct Answer
verified

The __________ of a product is what customers are generally willing to pay, and is sometimes used as a benchmark for pricing.

Correct Answer
verified

Tendollars.com offers thousands of gifts, all priced at $10. This is an example of a(n) __________.

Correct Answer
verified

Customary pricing refers to

Correct Answer
verified

What are the four kinds of discounts that are especially important in marketing pricing strategy?

Correct Answer
verified
Discounts are reductions from list price...
View Answer

A firm's profit objective is often measured in terms of ROA. The acronym ROA stands for __________.

Correct Answer
verified

Exam 11: Pricing Products and Services

Using __________, many retailers deliberately sell products below their normal prices (and sometimes below cost) to attract attention and additional store traffic.

Correct AnswerverifiedShow Answer

Functional discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Quantity discounts refer to

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

All of the following are competition-oriented approaches to selecting an approximate price level EXCEPT:

Correct AnswerverifiedShow Answer

-Figure 11-2 above represents the four approaches to selecting an appropriate price level. Box D includes customary and loss leader so it represents which approach?

Correct AnswerverifiedShow Answer

According to the price equation, final price equals list price minus __________ plus extra fees.

Correct AnswerverifiedShow Answer

Which of the following statements regarding cost-oriented approaches is most accurate?

Correct AnswerverifiedShow Answer

Which of the following companies would be most likely to use target return-on-investment pricing?

Correct AnswerverifiedShow Answer

After setting an approximate price level, the marketer proceeds to which step of the price-setting process?

Correct AnswerverifiedShow Answer

-In Figure 11-6 above, which is a break-even chart that depicts a graphic presentation of a break-even analysis for a picture frame store, the triangular area GAF represents the firm's

Correct AnswerverifiedShow Answer

Manufacturers of generic brands use which method of competition-oriented pricing?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Managing for long-run profits as a pricing objective implies that a company will

Correct AnswerverifiedShow Answer

The __________ of a product is what customers are generally willing to pay, and is sometimes used as a benchmark for pricing.

Correct AnswerverifiedShow Answer

Tendollars.com offers thousands of gifts, all priced at $10. This is an example of a(n) __________.

Correct AnswerverifiedShow Answer

Customary pricing refers to

Correct AnswerverifiedShow Answer

What are the four kinds of discounts that are especially important in marketing pricing strategy?

Correct AnswerverifiedDiscounts are reductions from list price...View AnswerShow Answer

A firm's profit objective is often measured in terms of ROA. The acronym ROA stands for __________.

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Discounts are reductions from list price...
View Answer

Correct Answer
verified