Question 1

Total revenue refers to

Accepted Answer

A)   the profit made from selling a product or service.
B)   the net gain in sales revenue if the unit price is lowered.
C)   the least number of units sold needed to cover product, distribution, and promotional costs.
D)   the amount at which marginal costs exceed fixed costs.
E)   the total money received from the sale of a product.F) A) and B)
G) A) and E)

Question 2

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

Accepted Answer

Demand-oriented approaches are (1)skimmi...

Question 3

A graphic presentation of the break-even analysis that shows the intersection of total revenue and total cost to identify profit or loss for a given quantity sold is referred to as a

Accepted Answer

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

Question 4

Odd-even pricing is based on

Accepted Answer

A)   culture-based superstitions about numbers.
B)   customers' interpretations of price.
C)   wholesalers' markups.
D)   manufacturers' markups.
E)   government regulators' constraints on price.F) D) and E)
G) C) and E)

Question 5

Some firms pursue a __________ pricing objective to generate cash to ward off bankruptcy.

Accepted Answer

A)   market share
B)   survival
C)   sales revenue
D)   single product line
E)   profitF) C) and D)
G) A) and C)

Question 6

Tendollars.com offers thousands of gifts,all priced at $10.0.0.0.0.This is an example of

Accepted Answer

A)   a skimming pricing approach.
B)   a loss-leader pricing approach.
C)   a one-price policy.
D)   a penetration pricing approach.
E)   an everyday low pricing approach.F) A) and D)
G) B) and E)

Question 7

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

Question 8

Companies often pursue a market share objective when

Accepted Answer

A)   industry sales are flat or declining.
B)   profits are increasing.
C)   industry sales are beginning to rise.
D)   there is a sudden increase in production costs.
E)   stockholders are seeking higher dividends.F) None of the above
G) A) and B)

Question 9

What are two special adjustments to the list or quoted price?

Accepted Answer

Two special adjustments to the...

Question 10

The horizontal axis of a demand curve graph represents

Accepted Answer

A)   market growth rate.
B)   relative market share.
C)   price per unit.
D)   potential profit in dollars.
E)   quantity demanded.F) A) and B)
G) A) and C)

Question 11

An online movie streaming service charges $14.4.99 per month for its basic package.However,when a competitor introduced the same service at
$13) 3.3.99,the firm dropped its price to
$13) 3.3.99.The firm most likely made this price reduction in an attempt to

Accepted Answer

A)   decrease revenue but increase profit.
B)   increase profit by increasing revenue.
C)   maintain market share.
D)   decrease market share.
E)   increase efficiency.F) A) and C)
G) B) and D)

Question 12

Distinguish between elastic demand and inelastic demand.

Accepted Answer

Elastic demand exists when a 1 percent d...

Question 13

Setting different prices for products and services depending on individual buyers and purchase situations in light of demand,cost,and competitive factors is referred to as

Accepted Answer

A)   price lining.
B)   a dynamic price policy.
C)   customary pricing.
D)   price fixing.
E)   discretionary pricing.F) B) and D)
G) None of the above

Question 14

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) D) and E)
G) None of the above

Question 15

Figure 11-5 
-The owner of a picture frame store has generated a spreadsheet of several calculations based on different quantity,price,revenue,cost,and profit scenarios shown in Figure 11 -5.Of the following options,at what sales level is profit maximized?

Accepted Answer

A)   0
B)   400
C)   800
D)   1,600
E)   2,000F) A) and C)
G) C) and E)

Question 16

A penetration pricing policy is most likely to be effective when

Accepted Answer

A)   lowering the price has only a minor effect on increasing the sales volume and reducing the unit cost.
B)   the high initial price will not attract competitors.
C)   a low initial price discourages competitors from entering the market.
D)   customers interpret the high price as signifying high quality.
E)   enough prospective customers are willing to buy immediately at the high initial price to make these sales profitable.F) A) and B)
G) All of the above

Question 17

Basic to setting a product's price is the extent of __________.This information is used in estimating the revenues the firm expects to receive.

Accepted Answer

A)   management's commitment to the product relative to other products in the line
B)   curiosity or interest potential consumers expressed during market testing
C)   customer demand for it
D)   the firm's promotional budget
E)   distribution requirementsF) D) and E)
G) A) and E)

Question 18

All of the following are demand-oriented approaches to selecting an approximate price level except which?

Accepted Answer

A)   odd-even
B)   yield management
C)   bundle
D)   loss leader
E)   prestigeF) B) and D)
G) B) and E)

Question 19

Predatory pricing is

Accepted Answer

A)   most effective in the growth stage of the product life cycle.
B)   a popular technique preferred by online businesses.
C)   illegal but often difficult to prosecute.
D)   most effective in business-to-business marketing.
E)   one of the most widely used pricing practices for professional marketers.F) B) and E)
G) A) and B)

Question 20

With the introduction of a revised pricing policy for e-books,distributors could still set their own retail prices,but with a restriction.Distributors could set prices below a publisher's retail list price as long as the discount

Accepted Answer

A)   was no more than 15%.
B)   exceeded the profit expected by the publisher.
C)   did not exceed the commission received from a publisher.
D)   would not result in prices lower than for equivalent hard copy books.
E)   would not result in a price below cost.F) A) and D)
G) A) and C)

Exam 11: Pricing Products and Services

With the introduction of a revised pricing policy for e-books,distributors could still set their own retail prices,but with a restriction.Distributors could set prices below a publisher's retail list price as long as the discount

Correct AnswerverifiedShow Answer

A penetration pricing policy is most likely to be effective when

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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

Basic to setting a product's price is the extent of __________.This information is used in estimating the revenues the firm expects to receive.

Correct AnswerverifiedShow Answer

A graphic presentation of the break-even analysis that shows the intersection of total revenue and total cost to identify profit or loss for a given quantity sold is referred to as a

Correct AnswerverifiedShow Answer

All of the following are demand-oriented approaches to selecting an approximate price level except which?

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What are two special adjustments to the list or quoted price?

Correct AnswerverifiedTwo special adjustments to the...View AnswerShow Answer

Figure 11-5 -The owner of a picture frame store has generated a spreadsheet of several calculations based on different quantity,price,revenue,cost,and profit scenarios shown in Figure 11 -5.Of the following options,at what sales level is profit maximized?

Correct AnswerverifiedShow Answer

Total revenue refers to

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

Correct AnswerverifiedDemand-oriented approaches are (1)skimmi...View AnswerShow Answer

Everyday low pricing refers to

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Companies often pursue a market share objective when

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The horizontal axis of a demand curve graph represents

Correct AnswerverifiedShow Answer

Odd-even pricing is based on

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Distinguish between elastic demand and inelastic demand.

Correct AnswerverifiedElastic demand exists when a 1 percent d...View AnswerShow Answer

Tendollars.com offers thousands of gifts,all priced at $10.0.0.0.0.This is an example of

Correct AnswerverifiedShow Answer

Some firms pursue a __________ pricing objective to generate cash to ward off bankruptcy.

Correct AnswerverifiedShow Answer

An online movie streaming service charges $14.4.99 per month for its basic package.However,when a competitor introduced the same service at $13) 3.3.99,the firm dropped its price to $13) 3.3.99.The firm most likely made this price reduction in an attempt to

Correct AnswerverifiedShow Answer

Setting different prices for products and services depending on individual buyers and purchase situations in light of demand,cost,and competitive factors is referred to as

Correct AnswerverifiedShow Answer

Predatory pricing is

Correct AnswerverifiedShow Answer

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Two special adjustments to the...
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Demand-oriented approaches are (1)skimmi...
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Elastic demand exists when a 1 percent d...
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