Question 1

Which of these is true about a pair of $200 designer denim jeans?

Accepted Answer

A)  The labor to make them comprises the largest percentage of the final price.
B)  The marketer must cover all of its operating costs while earning a profit.
C)  The specialty retailers that sell them account for only 25% of the cost so that the jeans can experience demand pull.
D)  The contract manufacturer for the jeans receives the least percentage of the final price.
E)  Material suppliers for designer denim jeans take the largest percentage of the final priceF) B) and E)
G) B) and C)

Question 2

A firm's profit equation demonstrates that profit equals __________.

Accepted Answer

A)  Total cost + Total revenue
B)  Total revenue - Total cost
C)  Marginal revenue - Marginal cost
D)  Price × Quantity
E)  Total revenue + Marginal costF) All of the above
G) D) and E)

Question 3

The __________ is the ratio of profit to the investment used to earn that profit.

Accepted Answer

A)  markup
B)  selling margin
C)  return on investment
D)  return on assets
E)  markdownF) A) and D)
G) B) and E)

Question 4

Pricing objectives refer to

Accepted Answer

A)  reconciling the prices charged by an organization to the values set forth in its business mission.
B)  taking specific steps to capitalize on an organization's internal strengths as they apply to price.
C)  specifying the role of price in an organization's marketing and strategic plans.
D)  taking specific steps to compensate for an organization's weaknesses as they apply to price.
E)  subjectively setting intrinsic values to all products and services offered by an organization.F) B) and C)
G) None of the above

Question 5

Bundle pricing refers to

Accepted Answer

A)  an extra amount of free goods awarded sellers in the channel of distribution for promoting a product.
B)  marketing two or more products in a single package price.
C)  using BOGOs - requiring customers to buy one to get one free - as a strategy to increase sales and profits.
D)  setting the price of a line of products at two specific pricing points.
E)  the practice of charging two or more prices depending upon the outlet carrying the product.F) A) and E)
G) A) and B)

Question 6

In order to deliver a product that the average consumer can afford, Vizio

Accepted Answer

A)  handles product design and marketing in the United States and relies on contract manufacturers in other countries to build the product.
B)  uses mass customization in other countries and then ships the HDTVs to the United States.
C)  purchased a small company in China to distribute its products under the Vizio name.
D)  purchased a small company in Japan to distribute its products under the Vizio name.
E)  relies solely on recycled materials to build high quality, no-frills products.F) D) and E)
G) All of the above

Question 7

Flexible Pricing Chart
-Consider the dynamic pricing chart above, which shows the results of a National Bureau of Economic Research study of 750,000 car purchases. The data indicate that some groups of car buyers, on average, paid roughly $105, $423, and $483 respectively for a new car in the $21,000 range than the typical purchaser. Who are the car buyers in C?

Accepted Answer

A)  women
B)  the elderly
C)  Hispanics
D)  African Americans
E)  Asian AmericansF) C) and D)
G) A) and E)

Question 8

A graphic presentation of the break-even analysis that shows when total revenue and total cost intersect to identify profit or loss for a given quantity sold is referred to as a(n)  __________.

Accepted Answer

A)  Gantt chart
B)  demand curve
C)  ROI analysis
D)  cross-tabulation
E)  break-even chartF) A) and B)
G) A) and C)

Question 9

A manufacturer using __________ is setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it.

Accepted Answer

A)  skimming pricing
B)  penetration pricing
C)  price lining
D)  odd-even pricing
E)  prestige pricingF) A) and B)
G) A) and C)

Question 10

Price discrimination refers to

Accepted Answer

A)  the practice of charging different prices to different buyers for goods of like grade and quality.
B)  an arrangement a manufacturer makes with a reseller to handle only its products and not those of a competitor.
C)  the practice of charging a very low price for a product with the intent of driving competitors out of business.
D)  a conspiracy among firms to set prices for a product or service.
E)  a seller's requirement that the purchaser of one product also buy another product in the lineF) B) and E)
G) All of the above

Question 11

Describe the pricing constraints a firm is likely to face.

Accepted Answer

Pricing constraints are factors that lim...

Question 12

Manufacturers use seasonal discounts to

Accepted Answer

A)  get rid of expired merchandise.
B)  prevent retailers from purchasing competitors' products.
C)  extend the peak seasonal selling season.
D)  encourage buyers to stock inventory earlier than their normal demand would require.
E)  temporarily spur primary demand during periods of soft sales, such as the beginning of a month, after which prices will return to normal when selective demand picks up.F) A) and B)
G) A) and C)

Question 13

Mark Johnson, the manager of a discount consumer electronics store, was approached by the manufacturer's representative on behalf of a marketer of a popular and profitable line of storage racks. The manufacturer's representative implied that if Johnson doesn't raise the retail prices for the storage racks to those paid by the marketer's non-discount customers, Johnson's supply of racks may be severely curtailed. The manufacturer's representative is guilty of attempting

Accepted Answer

A)  horizontal price-fixing.
B)  vertical price-fixing.
C)  price discrimination.
D)  predatory pricing.
E)  bait and switch pricing.F) B) and E)
G) A) and E)

Question 14

Which of the following pricing techniques results in the manufacturers deliberately adjusting the composition and features of a product to achieve the desired price for consumers?

Accepted Answer

A)  cost-plus percentage-of-cost pricing
B)  standard markup pricing
C)  cost-plus fixed-fee pricing
D)  experience curve pricing
E)  target pricingF) B) and E)
G) C) and E)

Question 15

A firm's profit equation equals

Accepted Answer

A)  Total cost + Total revenue or [(Fixed cost + Variable cost)  + (Unit price × Quantity sold) ].
B)  Total revenue - Total cost or [(Unit price × Quantity sold)  - (Fixed cost + Variable cost) ].
C)  Total cost - Marginal cost or [(Fixed cost + Variable cost)  - (Unit price × Quantity sold) ].
D)  Total cost - Variable cost or [(Fixed cost + Variable cost)  - (Unit price × Quantity sold) ].
E)  Total revenue/Total cost or [(Unit price × Quantity sold)  ÷ (Fixed cost + Variable cost) ].F) C) and E)
G) B) and D)

Question 16

Which of the following is a form of flexible pricing?

Accepted Answer

A)  odd-even pricing
B)  yield management pricing
C)  above-, at-, and below-market pricing
D)  target pricing
E)  cost-plus pricingF) All of the above
G) None of the above

Question 17

Identifying pricing objectives and constraints would occur during which stage of the price-setting process?

Accepted Answer

A)  Selecting an approximate price level
B)  Defining the scope of the product
C)  Setting the list or quoted price
D)  Evaluating the success of the price strategy
E)  Making special adjustments to the list priceF) C) and D)
G) C) and E)

Question 18

A flexible-price policy allows marketers to respond to

Accepted Answer

A)  requests for allowances.
B)  threats of discrimination.
C)  success measures for the firm's previous promotions.
D)  changes in demand, cost, and competitive factors.
E)  inquiries by government agencies.F) A) and B)
G) B) and D)

Question 19

Which of the following is a cost-oriented approach to pricing?

Accepted Answer

A)  cost-plus pricing
B)  skimming pricing
C)  prestige pricing
D)  loss-leader pricing
E)  bundle pricingF) A) and E)
G) D) and E)

Question 20

1 to the demand curve D2, the profit A) Figure 11-3B does not indicate what happens to profit when the quantity demanded changes. B) increases from $2 to $3 per unit. C) stays the same per unit. D) increases from $6 to $8 per unit. E) decreases from $8 to $6 per unit." class="answers-bank-image d-inline" rel="preload" >
-Figure 11-3B above shows that when the quantity demanded for Red Baron frozen cheese pizzas moves from 2 to 3 million units from the demand curve D1 to the demand curve D2, the profit

Accepted Answer

A)  Figure 11-3B does not indicate what happens to profit when the quantity demanded changes.
B)  increases from $2 to $3 per unit.
C)  stays the same per unit.
D)  increases from $6 to $8 per unit.
E)  decreases from $8 to $6 per unit.F) None of the above
G) B) and C)

Exam 11: Pricing Products and Services

Correct Answer
verified

A firm's profit equation demonstrates that profit equals __________.

Correct Answer
verified

Which of the following pricing techniques results in the manufacturers deliberately adjusting the composition and features of a product to achieve the desired price for consumers?

Correct Answer
verified

A manufacturer using __________ is setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it.

Correct Answer
verified

Price discrimination refers to

Correct Answer
verified

In order to deliver a product that the average consumer can afford, Vizio

Correct Answer
verified

The __________ is the ratio of profit to the investment used to earn that profit.

Correct Answer
verified

Which of these is true about a pair of $200 designer denim jeans?

Correct Answer
verified

A firm's profit equation equals

Correct Answer
verified

Identifying pricing objectives and constraints would occur during which stage of the price-setting process?

Correct Answer
verified

-Figure 11-3B above shows that when the quantity demanded for Red Baron frozen cheese pizzas moves from 2 to 3 million units from the demand curve D₁ to the demand curve D₂, the profit

Correct Answer
verified

Bundle pricing refers to

Correct Answer
verified

A flexible-price policy allows marketers to respond to

Correct Answer
verified

Pricing objectives refer to

Correct Answer
verified

Which of the following is a cost-oriented approach to pricing?

Correct Answer
verified

Correct Answer
verified

Manufacturers use seasonal discounts to

Correct Answer
verified

Which of the following is a form of flexible pricing?

Correct Answer
verified

Describe the pricing constraints a firm is likely to face.

Correct Answer
verified
Pricing constraints are factors that lim...
View Answer

A graphic presentation of the break-even analysis that shows when total revenue and total cost intersect to identify profit or loss for a given quantity sold is referred to as a(n) __________.

Correct Answer
verified

Exam 11: Pricing Products and Services

Correct AnswerverifiedShow Answer

A firm's profit equation demonstrates that profit equals __________.

Correct AnswerverifiedShow Answer

Which of the following pricing techniques results in the manufacturers deliberately adjusting the composition and features of a product to achieve the desired price for consumers?

Correct AnswerverifiedShow Answer

A manufacturer using __________ is setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it.

Correct AnswerverifiedShow Answer

Price discrimination refers to

Correct AnswerverifiedShow Answer

In order to deliver a product that the average consumer can afford, Vizio

Correct AnswerverifiedShow Answer

The __________ is the ratio of profit to the investment used to earn that profit.

Correct AnswerverifiedShow Answer

Which of these is true about a pair of $200 designer denim jeans?

Correct AnswerverifiedShow Answer

A firm's profit equation equals

Correct AnswerverifiedShow Answer

Identifying pricing objectives and constraints would occur during which stage of the price-setting process?

Correct AnswerverifiedShow Answer

-Figure 11-3B above shows that when the quantity demanded for Red Baron frozen cheese pizzas moves from 2 to 3 million units from the demand curve D1 to the demand curve D2, the profit

Correct AnswerverifiedShow Answer

Bundle pricing refers to

Correct AnswerverifiedShow Answer

A flexible-price policy allows marketers to respond to

Correct AnswerverifiedShow Answer

Pricing objectives refer to

Correct AnswerverifiedShow Answer

Which of the following is a cost-oriented approach to pricing?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Manufacturers use seasonal discounts to

Correct AnswerverifiedShow Answer

Which of the following is a form of flexible pricing?

Correct AnswerverifiedShow Answer

Describe the pricing constraints a firm is likely to face.

Correct AnswerverifiedPricing constraints are factors that lim...View AnswerShow Answer

A graphic presentation of the break-even analysis that shows when total revenue and total cost intersect to identify profit or loss for a given quantity sold is referred to as a(n) __________.

Correct AnswerverifiedShow 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

-Figure 11-3B above shows that when the quantity demanded for Red Baron frozen cheese pizzas moves from 2 to 3 million units from the demand curve D₁ to the demand curve D₂, the profit

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Pricing constraints are factors that lim...
View Answer

Correct Answer
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