Question 1

There are several factors that predict when a skimming pricing policy is likely to be most effective,including situations in which

Accepted Answer

A)   consumers tend to be price-sensitive.
B)   enough prospective customers are willing to buy immediately at a high initial price to make these sales profitable.
C)   leadership is expecting to meet high sales unit goals.
D)   a lower price will significantly reduce unit costs.
E)   consumers perceive your product to be similar to other products in the market.F) C) and D)
G) C) and E)

Question 2

Prestige pricing refers to

Accepted Answer

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 odd-even pricing.
C)   setting a market price for a product or product class based on a subjective feel for the competitors' price or market price.
D)   setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it.
E)   setting a price that is dictated by tradition, a standardized channel of distribution, or other competitive factors.F) A) and D)
G) A) and B)

Question 3

Adding a fixed percentage to the cost of all items in a specific product class is referred to as

Accepted Answer

A)   target profit pricing.
B)   standard markup pricing.
C)   target return-on-investment pricing.
D)   customary pricing.
E)   everyday low pricing.F) A) and B)
G) B) and C)

Question 4

Unit variable cost refers to variable cost expressed

Accepted Answer

A)   as the sum of all units sold.
B)   on a per unit basis for a product.
C)   as a percentage of total sales.
D)   as a percentage of fixed costs.
E)   as a percentage of total costs.F) A) and E)
G) A) and D)

Question 5

Figure 11-3a 
-Which of the following illustrates movement along the demand curve?

Accepted Answer

A)   Prices remain the same, but there is a significant increase in demand.
B)   Prices remain the same, but there is a significant decrease in demand.
C)   As the price is raised, the quantity demanded increases, assuming all demand factors stay the same.
D)   As the price is lowered, the quantity demanded increases, assuming all demand factors stay the same.
E)   Movement along the curve indicates that some significant event has taken place outside the organization that has affected demand.F) B) and E)
G) All of the above

Question 6

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)   using 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) A) and E)

Question 7

Which of the following statements about the product life cycle as a pricing constraint is most accurate?

Accepted Answer

A)   The newer a product is, the higher the price that can usually be charged.
B)   The later in the product life cycle a product is, the higher the price that can usually be charged.
C)   Once a product is considered nostalgic, the price will continue to rise indefinitely.
D)   Fads will generally have only two price points-high and low-but the values of those price points usually will be within 10 percent of each other.
E)   Prices should not be changed until a product reaches its maturity stage.F) A) and B)
G) D) and E)

Question 8

Explain the price equation in the context of a new car purchase.

Accepted Answer

The price equation is: Final price = Lis...

Question 9

A target return profit objective implies that a company chooses to

Accepted Answer

A)   set targets whose performance can be measured quickly.
B)   give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets.
C)   set a profit goal that is often determined by its board of directors.
D)   reduce investment in any further market or product research.
E)   set prices based on return on sales.F) C) and D)
G) B) and C)

Question 10

Which one of the following statements regarding bundle pricing is most accurate?

Accepted Answer

A)   Bundle pricing is intended to benefit the consumer, not the seller.
B)   Bundle pricing is really "bundle packaging" since the price charged is for two or more of the same products that are shrink-wrapped together.
C)   Bundle pricing is often associated with a skimming strategy.
D)   Bundle pricing often provides a lower total cost to buyers and lower marketing costs to sellers.
E)   Bundle pricing is based on the idea that consumers value the individual items more than they value the group contained in the package.F) C) and D)
G) B) and E)

Question 11

Wrigley recently introduced a new flavor of Orbit brand sugar-free chewing gum-mint mojito.The introductory price was low so that it quickly created loyal customers for the flavor.In this example,Wrigley used

Accepted Answer

A)   skimming pricing.
B)   penetration pricing.
C)   price lining.
D)   odd-even pricing.
E)   loss-leader pricing.F) A) and D)
G) C) and D)

Question 12

The percentage change in quantity demanded relative to the percentage change in price is referred to as

Accepted Answer

A)   price elasticity of demand.
B)   demand derivative of price.
C)   average demand.
D)   marginal revenue.
E)   derived demand.F) A) and E)
G) A) and D)

Question 13

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 pricing.F) A) and E)
G) A) and D)

Question 14

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

Accepted Answer

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

Exam 11: Pricing Products and Services

Figure 11-3a -Which of the following illustrates movement along the demand curve?

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

Correct Answer
verified

The percentage change in quantity demanded relative to the percentage change in price is referred to as

Correct Answer
verified

A target return profit objective implies that a company chooses to

Correct Answer
verified

Which of the following statements about the product life cycle as a pricing constraint is most accurate?

Correct Answer
verified

Explain the price equation in the context of a new car purchase.

Correct Answer
verified
The price equation is: Final price = Lis...
View Answer

Customary pricing refers to

Correct Answer
verified

There are several factors that predict when a skimming pricing policy is likely to be most effective,including situations in which

Correct Answer
verified

Adding a fixed percentage to the cost of all items in a specific product class is referred to as

Correct Answer
verified

Which one of the following statements regarding bundle pricing is most accurate?

Correct Answer
verified

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

Correct Answer
verified

Prestige pricing refers to

Correct Answer
verified

Unit variable cost refers to variable cost expressed

Correct Answer
verified

Wrigley recently introduced a new flavor of Orbit brand sugar-free chewing gum-mint mojito.The introductory price was low so that it quickly created loyal customers for the flavor.In this example,Wrigley used

Correct Answer
verified

Exam 11: Pricing Products and Services

Figure 11-3a -Which of the following illustrates movement along the demand curve?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The percentage change in quantity demanded relative to the percentage change in price is referred to as

Correct AnswerverifiedShow Answer

A target return profit objective implies that a company chooses to

Correct AnswerverifiedShow Answer

Which of the following statements about the product life cycle as a pricing constraint is most accurate?

Correct AnswerverifiedShow Answer

Explain the price equation in the context of a new car purchase.

Correct AnswerverifiedThe price equation is: Final price = Lis...View AnswerShow Answer

Customary pricing refers to

Correct AnswerverifiedShow Answer

There are several factors that predict when a skimming pricing policy is likely to be most effective,including situations in which

Correct AnswerverifiedShow Answer

Adding a fixed percentage to the cost of all items in a specific product class is referred to as

Correct AnswerverifiedShow Answer

Which one of the following statements regarding bundle pricing is most accurate?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Prestige pricing refers to

Correct AnswerverifiedShow Answer

Unit variable cost refers to variable cost expressed

Correct AnswerverifiedShow Answer

Wrigley recently introduced a new flavor of Orbit brand sugar-free chewing gum-mint mojito.The introductory price was low so that it quickly created loyal customers for the flavor.In this example,Wrigley used

Correct AnswerverifiedShow Answer

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Correct Answer
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Correct Answer
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Correct Answer
verified
The price equation is: Final price = Lis...
View 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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