Question 1

Factors that determine consumers' willingness and ability to pay for products and services are referred to as

Accepted Answer

A)  supply factors.
B)  demand factors.
C)  affordability factors.
D)  elasticity factors.
E)  macro environmental factors.F) B) and D)
G) None of the above

Question 2

If a firm finds the demand for one of its products is inelastic,it can increase its total revenues by

Accepted Answer

A)  lowering its price.
B)  increasing fixed costs only.
C)  increasing variable costs only.
D)  increasing both fixed and variable costs.
E)  raising its price.F) A) and E)
G) C) and E)

Question 3

A promotional allowance refers to

Accepted Answer

A)  a one-time discount that must be used within a certain time frame or it expires.
B)  the cash payments or an extra amount of "free goods" awarded sellers in the marketing channel for undertaking certain advertising or selling activities to promote the product.
C)  the return of money based on proof of purchase.
D)  short-term price reductions when consumer demand takes a significant and unexpected dip.
E)  incentives,such as trips,cruises,jewelry,etc.,presented to brand-loyal customers.F) All of the above
G) B) and C)

Question 4

The first Apple iPad was introduced in 2010 at an initial price of $650 for the 16 GB version.People waited in line overnight so they could be one of the first to own this unique tablet device.Which pricing strategy did Apple use to help recoup its research and development costs for the iPad?

Accepted Answer

A)  price lining
B)  penetration pricing
C)  customary pricing
D)  skimming pricing
E)  target pricingF) All of the above
G) A) and C)

Question 5

All of the following are examples of a price EXCEPT:

Accepted Answer

A)  a premium.
B)  barter.
C)  tuition.
D)  a commission.
E)  profit.F) A) and E)
G) C) and E)

Question 6

Odd-even pricing refers to

Accepted Answer

A)  setting prices one way for product lines and another way for individual brands.
B)  setting prices of luxury items at even price points and setting the price of necessities at odd price points.
C)  setting prices a few dollars or cents under an odd number.
D)  adding a fixed percentage to the cost of all items in a specific product class.
E)  setting prices a few dollars or cents under an even number.F) B) and D)
G) B) and C)

Question 7

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 fat-free ice cream?

Accepted Answer

A)  The ice cream market is highly elastic.
B)  A large portion of the market has inelastic demand for ice cream-over a fairly broad range of prices.
C)  Economies of scale in production would be substantial.
D)  Retailers are not willing to pay for new brands of premium ice cream in the already overcrowded category.
E)  Once the initial price is set,it is nearly impossible to lower the price without alienating early buyers.F) A) and C)
G) A) and E)

Question 8

In response to Duracell's introduction of the Duracell Ultra battery,Energizer introduced an Advanced Formula battery.But unlike Duracell,Energizer priced its batteries at a low initial price to attract the mass market.Was Energizer's pricing strategy to take market share from Duracell a success?

Accepted Answer

A)  No,because consumers are price-insensitive when it comes to batteries.
B)  Yes,because of the positive association with the "Energizer Bunny" marketing campaign.
C)  No,because consumers were unable to perceive the improved quality due to the low price.
D)  Yes,because consumers typically respond positively to cost-plus pricing.
E)  Yes,because the demand for batteries has unitary elasticity.F) A) and B)
G) B) and E)

Question 9

If the CEO of the Clorox Company was to say,"We want to control 60 percent of the bleach market within the next five years," he would have set a __________ pricing objective.

Accepted Answer

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

Question 10

Everyday low pricing refers to

Accepted Answer

A)  the pricing strategy of "extreme value" stores to maintain high price-quality images for the products they sell.
B)  the pricing strategy of starting a product at standard list price and then lowering the price by a certain percentage until it is sold.
C)  short-term price reductions when consumer demand takes a significant and unexpected dip.
D)  the practice of replacing promotional allowances with lower manufacturer list prices.
E)  a form of predatory pricing used solely for the purpose of undercutting competitors' prices.F) C) and E)
G) C) and D)

Question 11

The acronym "EDLP" stands for __________.

Accepted Answer

A)  estimated discount leveling policy.
B)  extended discounts for loss-leader products.
C)  everyday low pricing.
D)  either (free) delivery or lower prices.
E)  extended discounts in lieu of lower pricing.F) C) and E)
G) A) and D)

Question 12

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 in unit costs for purchasing items that are nearing their expiration dates.
E)  reductions in unit costs for taking merchandise that will soon be replaced by new and improved versions of the original product.F) All of the above
G) D) and E)

Question 13

Figure 11-2
-Figure 11-2 above represents the four approaches to selecting an appropriate price level."B" includes standard markup and cost-plus so it represents which approach?

Accepted Answer

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

Question 14

Four pricing practices are closely scrutinized because of potentially unethical or illegal actions.They include: (1) price fixing; (2) predatory pricing; (3) deceptive pricing; and (4) __________.

Accepted Answer

A)  price discounting
B)  segmentation
C)  regional rollbacks
D)  delayed payment penalties
E)  price discriminationF) A) and C)
G) None of the above

Question 15

List four of the seven demand-oriented approaches to selecting an approximate price level and define what they are.

Accepted Answer

Demand-oriented approaches include: (1)S...

Question 16

The ratio of perceived benefits to __________ is referred to as value.

Accepted Answer

A)  price
B)  prestige
C)  perceived quality
D)  profits
E)  perceived costsF) A) and E)
G) A) and D)

Question 17

Explain why odd-even pricing may be successful.

Accepted Answer

Odd-even pricing presumes that...

Question 18

The break-even point (BEP) = [__________ ÷ (Unit price − Unit variable cost) ].

Accepted Answer

A)  Total cost
B)  Total expense
C)  Fixed cost
D)  Unit variable cost
E)  Total number of units produced or quantityF) B) and E)
G) C) and D)

Question 19

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) B) and C)
G) B) and E)

Question 20

According to the price equation,a product's or service's final price equals its list price minus incentives and allowances plus

Accepted Answer

A)  profits.
B)  commissions.
C)  trade-ins.
D)  extra fees.
E)  taxes.F) A) and B)
G) B) and E)

Exam 11: Pricing Products and Services

Figure 11-2 -Figure 11-2 above represents the four approaches to selecting an appropriate price level."B" includes standard markup and cost-plus so it represents which approach?

Correct Answer
verified

Odd-even pricing refers to

Correct Answer
verified

Correct Answer
verified

If a firm finds the demand for one of its products is inelastic,it can increase its total revenues by

Correct Answer
verified

All of the following are examples of a price EXCEPT:

Correct Answer
verified

Everyday low pricing refers to

Correct Answer
verified

The ratio of perceived benefits to __________ is referred to as value.

Correct Answer
verified

List four of the seven demand-oriented approaches to selecting an approximate price level and define what they are.

Correct Answer
verified
Demand-oriented approaches include: (1)S...
View Answer

A promotional allowance refers to

Correct Answer
verified

Factors that determine consumers' willingness and ability to pay for products and services are referred to as

Correct Answer
verified

Explain why odd-even pricing may be successful.

Correct Answer
verified
Odd-even pricing presumes that...
View Answer

Four pricing practices are closely scrutinized because of potentially unethical or illegal actions.They include: (1) price fixing; (2) predatory pricing; (3) deceptive pricing; and (4) __________.

Correct Answer
verified

If the CEO of the Clorox Company was to say,"We want to control 60 percent of the bleach market within the next five years," he would have set a __________ pricing objective.

Correct Answer
verified

The first Apple iPad was introduced in 2010 at an initial price of $650 for the 16 GB version.People waited in line overnight so they could be one of the first to own this unique tablet device.Which pricing strategy did Apple use to help recoup its research and development costs for the iPad?

Correct Answer
verified

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

Correct Answer
verified

The acronym "EDLP" stands for __________.

Correct Answer
verified

According to the price equation,a product's or service's final price equals its list price minus incentives and allowances plus

Correct Answer
verified

The break-even point (BEP) = [__________ ÷ (Unit price − Unit variable cost) ].

Correct Answer
verified

Quantity discounts refer to

Correct Answer
verified

In response to Duracell's introduction of the Duracell Ultra battery,Energizer introduced an Advanced Formula battery.But unlike Duracell,Energizer priced its batteries at a low initial price to attract the mass market.Was Energizer's pricing strategy to take market share from Duracell a success?

Correct Answer
verified

Exam 11: Pricing Products and Services

Figure 11-2 -Figure 11-2 above represents the four approaches to selecting an appropriate price level."B" includes standard markup and cost-plus so it represents which approach?

Correct AnswerverifiedShow Answer

Odd-even pricing refers to

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If a firm finds the demand for one of its products is inelastic,it can increase its total revenues by

Correct AnswerverifiedShow Answer

All of the following are examples of a price EXCEPT:

Correct AnswerverifiedShow Answer

Everyday low pricing refers to

Correct AnswerverifiedShow Answer

The ratio of perceived benefits to __________ is referred to as value.

Correct AnswerverifiedShow Answer

List four of the seven demand-oriented approaches to selecting an approximate price level and define what they are.

Correct AnswerverifiedDemand-oriented approaches include: (1)S...View AnswerShow Answer

A promotional allowance refers to

Correct AnswerverifiedShow Answer

Factors that determine consumers' willingness and ability to pay for products and services are referred to as

Correct AnswerverifiedShow Answer

Explain why odd-even pricing may be successful.

Correct AnswerverifiedOdd-even pricing presumes that...View AnswerShow Answer

Four pricing practices are closely scrutinized because of potentially unethical or illegal actions.They include: (1) price fixing; (2) predatory pricing; (3) deceptive pricing; and (4) __________.

Correct AnswerverifiedShow Answer

If the CEO of the Clorox Company was to say,"We want to control 60 percent of the bleach market within the next five years," he would have set a __________ pricing objective.

Correct AnswerverifiedShow Answer

The first Apple iPad was introduced in 2010 at an initial price of $650 for the 16 GB version.People waited in line overnight so they could be one of the first to own this unique tablet device.Which pricing strategy did Apple use to help recoup its research and development costs for the iPad?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The acronym "EDLP" stands for __________.

Correct AnswerverifiedShow Answer

According to the price equation,a product's or service's final price equals its list price minus incentives and allowances plus

Correct AnswerverifiedShow Answer

The break-even point (BEP) = [__________ ÷ (Unit price − Unit variable cost) ].

Correct AnswerverifiedShow Answer

Quantity discounts refer to

Correct AnswerverifiedShow Answer

In response to Duracell's introduction of the Duracell Ultra battery,Energizer introduced an Advanced Formula battery.But unlike Duracell,Energizer priced its batteries at a low initial price to attract the mass market.Was Energizer's pricing strategy to take market share from Duracell a success?

Correct AnswerverifiedShow Answer

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Demand-oriented approaches include: (1)S...
View Answer

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verified
Odd-even pricing presumes that...
View Answer

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