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Exam 10: Managing Pricing Decisions

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Question 1

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Effectively communicating a product's differential advantages is at the heart of positioning strategy,and exposure to these elements spurs the customer to develop perceptions of value and a subsequent understanding of the value proposition.

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Question 2

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Stephen is developing a new website for the sports and recreation retailer he works at.He is trying to figure out how to display prices.His company prides itself on consistently selling prices below manufacturer suggested retail price and he would like to indicate this on the website.What do you think Stephen should do?

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Stephen should use reference pricing.He can show the manufacturer's suggested list price next to the actual price the product is offered for in the catalog.Additionally,he can carry that over to the retail stores displaying prices in the same way.

Question 3

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When using _______________ a bottom line profit is established first and then pricing is set to achieve the target.

Amelie is the marketing manager at a café in Charleston,South Carolina.The chef/owner is about to introduce a new dish and Amelie is planning on pricing the dish low at the beginning,but slowly raising the price over time.Amelie is applying _____.

Doug runs a hardware store.He puts prices on the products and scans them when they get to the register.The price that is marked is the price that will be charged,no exceptions.Doug uses __________________.

In the past,__________________ allowed manufacturers to establish artificially high prices by limiting the ability of wholesalers and retailers to offer reduced or discounted prices.

Captive pricing is not common in the service sector.

Solid Surface,a countertop store,will give customers a 10% discount if they pay their bills in full in 20 days,however after 20 days they do not receive a discount.This is an example of ______________.

Jasper wants to get his retailers and wholesalers to help him promote his product,what tool could Jasper use to achieve this goal?

Odd pricing can backfire if misapplied,specifically to service industries.

Lovella and Curtis both work in the marketing department at a car dealership.They have been asked to determine the best pricing strategy for some of the service department offerings.Curtis is in favor of a price bundling strategy,while Lovella wants to steer clear of price bundling.Lovella says that some customers can view price bundling as a negative.Why might Lovella think this? What can she and Curtis do to overcome this?

__________________ means that title transfer and freight paid on the goods being shipped are based on the free on board location.

_______________ are products that are sacrificed at prices below cost or close to cost in order to attract shoppers to the store.

Carol Ann is trying to explain to one of her ticket counter associates the differences in price associated with concert tickets.She explains that the lowest priced tickets are for the least desirable seats and the highest priced tickets are for the most desirable seats,with the rest of the ticket prices falling somewhere in-between.Carol Ann is describing ___________________.

Michael Porter has consistently advocated that firms that are able to compete based on some extraordinary efficiency in one or more internal processes bring to the market a competitive advantage based on _________________.

Krista wants to buy a new foaming soap dispenser.Currently the store is offering the dispenser for free when she purchases the largest refill of soap.The pricing strategy being used for the dispenser and soap is ____________________.

With _________________,customers are allowed-even encouraged-to haggle about prices.

Andrew has just taken over as CEO of one of the nation's top hotel chains.He recognizes that hotel room prices are quite unstable and he would like to neutralize them.What strategy is Andrew considering employing? Why would this be a good strategy?

A company's core cost advantages translate directly to an edge over its competitors based on much more flexibility in its __________________ as well as its ability to translate some of the cost savings to the bottom line.

Sophie works for Music Masters,a company that creates a line of speakers for use in both indoor and outdoor settings.The company has just finished creating a new line of products for the holiday season and Sophie is looking to set the pricing.Sophie wants to have all of the items in the new product line to have complementary pricing.What would be the best pricing strategy for Sophie to implement?