Question 1

For which of the following is demand likely to be most sensitive to price increases?

Accepted Answer

A)   Prescription drugs.
B)   College tuition for last-semester seniors.
C)   Electricity.
D)   Hospital care.
E)   A specific brand of soft drink.

Question 2

An everyday low pricing strategy stresses the continuity of retail prices:

Accepted Answer

A)   at a level above regular retail prices and below deep-discount prices.
B)   based on horizontal price fixing.
C)   bundled with cost-based,cash discounts.
D)   at a level somewhere between the regular price and the deep-discount sale prices competitors may offer.
E)   at a price skimming level.

Question 3

Thanh owns a shoe store.In this market,there are many firms competing for the same customers,but the products offered differ by quality and price.Out of the four levels of competition,which one does this market represent?

Accepted Answer

A)   Monopolistic competition
B)   Pure competition
C)   Oligopolistic competition
D)   Monopoly
E)   Dominant competition

Question 4

It is legitimate for a manufacturer to charge a retailer a lower price than its usual price if:

Accepted Answer

A)   the retailer is related to the seller.
B)   neither the retailer nor the seller are publically-traded companies.
C)   the seller is trying to match a competitor's price.
D)   the different price is a one-time occurrence.
E)   the difference between the regular price and the reduced price is less than or equal to ten percent.

Question 5

How is the price elasticity for Crest toothpaste likely to be different from the price elasticity for all toothpastes (a product category)? Why are they likely to be different?

Accepted Answer

The price elasticity for Crest toothpast...

Question 6

What does "price is the overall sacrifice a consumer makes to acquire a product" mean?

Accepted Answer

It means price is more than ju...

Question 7

If a firm is engaged in monopolistic competition,it should seek a way to differentiate itself.

Accepted Answer

A) True 
 B)False

Question 8

Price is the __________ a consumer is willing to make to acquire a specific product or service.

Accepted Answer

A)   amount of money
B)   overall sacrifice
C)   fixed cost
D)   target return
E)   variable cost

Question 9

When HP first introduced their Inkjet printers,consumers could only buy refill cartridges from HP.HP made significant profits from the sale of replacement cartridges.In this situation,HP logically used a __________ pricing strategy for their printers.

Accepted Answer

A)   market penetration
B)   loss leader
C)   price fixing
D)   reference
E)   skimming

Question 10

What type of pricing tactic is being used when several airlines agree to charge the same fare for a single route.

Accepted Answer

A)   Horizontal price fixing
B)   Vertical price fixing
C)   Horizontal price discrimination
D)   Vertical price discrimination
E)   Loss leader pricing

Question 11

Many years ago Honda's Accord and Ford's Taurus were the top two selling cars in the United States.As the year was coming to an end,Ford cut the price of the Taurus,hoping to outsell the Accord and allow Ford to claim that "Taurus is the best-selling car in America." Ford was using a __________ pricing strategy.

Accepted Answer

A)   maximizing profits
B)   target profit
C)   sales orientation
D)   status quo
E)   target return

Question 12

Price advertisements should never:

Accepted Answer

A)   include "puffery."
B)   deceive customers to the point of doing harm.
C)   include the price.
D)   use advertising allowances to increase sales promotion.
E)   use price skimming after using price penetration.

Question 13

Brandon is conducting an experiment,charging different prices for the same products at different stores and measuring sales.With this information,he will construct a demand curve.How can Brandon use this information?

Accepted Answer

He can use this information to estimate ...

Question 14

Charging a relatively high price for new and innovative products to those consumers most willing and able to pay the high price is called price:

Accepted Answer

A)   penetration.
B)   bundling.
C)   fixing.
D)   referencing.
E)   skimming.

Question 15

Gerhard explains the concept of break-even analysis to his father who owns a daycare center.Gerhard's father grimaces,saying,that break-even analysis is too simplistic and won't work for him.What specific limitations associated with break-even analysis will Gerhard's father probably point out?

Accepted Answer

First,even in a relatively simple busine...

Question 16

Patricia and D'Wayne were working on pricing their line of handcrafted office furniture.D'Wayne said,"I think we've got all the main components that affect us and our products,but let's go over the list once again.We've got the stores that will carry our products,our firm's objectives,how customers will respond,and the costs." Which of the following is missing from Patricia and D'Wayne's list of the components?

Accepted Answer

A)   The message and media for the advertising campaign.
B)   The competition's pricing strategies.
C)   The designs for products that haven't yet been manufactured.
D)   The number of new employees they'll need if the products take off.
E)   Whether or not their suppliers use sustainable raw materials.

Question 17

The break-even point is estimated by:

Accepted Answer

A)   multiplying revenue per unit times the quantity sold.
B)   dividing fixed contribution per unit by variable costs.
C)   multiplying fixed costs by contribution per unit.
D)   dividing fixed costs by contribution per unit.
E)   dividing variable costs by fixed costs.

Question 18

Tess is the marketing manager for a fast food restaurant chain.She uses a target return pricing strategy because her firm's primary objective is to:

Accepted Answer

A)   increase profits.
B)   increase sales.
C)   decrease competition.
D)   build customer satisfaction.
E)   all of these.

Question 19

How can a company find its way out of a market characterized by pure competition?

Accepted Answer

A)   Consistently offer the lowest price until other competitors leave the market.
B)   Increase prices and attract different,quality-oriented customers.
C)   Decrease the amount of available product until the market reacts.
D)   Increase the amount of available product to flood the market.
E)   Differentiate the product in some way,even by packaging,so customers will see it as distinct.

Question 20

Marketers can deliver high value through high or low prices,depending on:

Accepted Answer

A)   profit contribution per unit.
B)   the bundle of benefits the product or service delivers.
C)   monopolistic competition.
D)   target return pricing that is greater than variable cost per unit.
E)   the income effect.

Exam 13: Pricing Concepts for Establishing Value

Price is the __________ a consumer is willing to make to acquire a specific product or service.

Correct Answer
verified

When HP first introduced their Inkjet printers,consumers could only buy refill cartridges from HP.HP made significant profits from the sale of replacement cartridges.In this situation,HP logically used a __________ pricing strategy for their printers.

Correct Answer
verified

Brandon is conducting an experiment,charging different prices for the same products at different stores and measuring sales.With this information,he will construct a demand curve.How can Brandon use this information?

Correct Answer
verified
He can use this information to estimate ...
View Answer

If a firm is engaged in monopolistic competition,it should seek a way to differentiate itself.

Correct Answer
verified

For which of the following is demand likely to be most sensitive to price increases?

Correct Answer
verified

How can a company find its way out of a market characterized by pure competition?

Correct Answer
verified

What does "price is the overall sacrifice a consumer makes to acquire a product" mean?

Correct Answer
verified
It means price is more than ju...
View Answer

Marketers can deliver high value through high or low prices,depending on:

Correct Answer
verified

Gerhard explains the concept of break-even analysis to his father who owns a daycare center.Gerhard's father grimaces,saying,that break-even analysis is too simplistic and won't work for him.What specific limitations associated with break-even analysis will Gerhard's father probably point out?

Correct Answer
verified
First,even in a relatively simple busine...
View Answer

How is the price elasticity for Crest toothpaste likely to be different from the price elasticity for all toothpastes (a product category)? Why are they likely to be different?

Correct Answer
verified
The price elasticity for Crest toothpast...
View Answer

Correct Answer
verified

An everyday low pricing strategy stresses the continuity of retail prices:

Correct Answer
verified

Thanh owns a shoe store.In this market,there are many firms competing for the same customers,but the products offered differ by quality and price.Out of the four levels of competition,which one does this market represent?

Correct Answer
verified

Correct Answer
verified

What type of pricing tactic is being used when several airlines agree to charge the same fare for a single route.

Correct Answer
verified

Tess is the marketing manager for a fast food restaurant chain.She uses a target return pricing strategy because her firm's primary objective is to:

Correct Answer
verified

Charging a relatively high price for new and innovative products to those consumers most willing and able to pay the high price is called price:

Correct Answer
verified

Price advertisements should never:

Correct Answer
verified

It is legitimate for a manufacturer to charge a retailer a lower price than its usual price if:

Correct Answer
verified

The break-even point is estimated by:

Correct Answer
verified

Exam 13: Pricing Concepts for Establishing Value

Price is the __________ a consumer is willing to make to acquire a specific product or service.

Correct AnswerverifiedShow Answer

When HP first introduced their Inkjet printers,consumers could only buy refill cartridges from HP.HP made significant profits from the sale of replacement cartridges.In this situation,HP logically used a __________ pricing strategy for their printers.

Correct AnswerverifiedShow Answer

Brandon is conducting an experiment,charging different prices for the same products at different stores and measuring sales.With this information,he will construct a demand curve.How can Brandon use this information?

Correct AnswerverifiedHe can use this information to estimate ...View AnswerShow Answer

If a firm is engaged in monopolistic competition,it should seek a way to differentiate itself.

Correct AnswerverifiedShow Answer

For which of the following is demand likely to be most sensitive to price increases?

Correct AnswerverifiedShow Answer

How can a company find its way out of a market characterized by pure competition?

Correct AnswerverifiedShow Answer

What does "price is the overall sacrifice a consumer makes to acquire a product" mean?

Correct AnswerverifiedIt means price is more than ju...View AnswerShow Answer

Marketers can deliver high value through high or low prices,depending on:

Correct AnswerverifiedShow Answer

Gerhard explains the concept of break-even analysis to his father who owns a daycare center.Gerhard's father grimaces,saying,that break-even analysis is too simplistic and won't work for him.What specific limitations associated with break-even analysis will Gerhard's father probably point out?

Correct AnswerverifiedFirst,even in a relatively simple busine...View AnswerShow Answer

How is the price elasticity for Crest toothpaste likely to be different from the price elasticity for all toothpastes (a product category)? Why are they likely to be different?

Correct AnswerverifiedThe price elasticity for Crest toothpast...View AnswerShow Answer

Correct AnswerverifiedShow Answer

An everyday low pricing strategy stresses the continuity of retail prices:

Correct AnswerverifiedShow Answer

Thanh owns a shoe store.In this market,there are many firms competing for the same customers,but the products offered differ by quality and price.Out of the four levels of competition,which one does this market represent?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

What type of pricing tactic is being used when several airlines agree to charge the same fare for a single route.

Correct AnswerverifiedShow Answer

Tess is the marketing manager for a fast food restaurant chain.She uses a target return pricing strategy because her firm's primary objective is to:

Correct AnswerverifiedShow Answer

Charging a relatively high price for new and innovative products to those consumers most willing and able to pay the high price is called price:

Correct AnswerverifiedShow Answer

Price advertisements should never:

Correct AnswerverifiedShow Answer

It is legitimate for a manufacturer to charge a retailer a lower price than its usual price if:

Correct AnswerverifiedShow Answer

The break-even point is estimated by:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
verified
He can use this information to estimate ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
It means price is more than ju...
View Answer

Correct Answer
verified

Correct Answer
verified
First,even in a relatively simple busine...
View Answer

Correct Answer
verified
The price elasticity for Crest toothpast...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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