Question 1

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) B) and D)
G) C) and D)

Question 2

The use of special fees and surcharges is driven by consumers' zeal for __________ combined with the ease of making price comparisons on the Internet.

Accepted Answer

A)  high prices
B)  low prices
C)  quality
D)  value
E)  warrantiesF) B) and D)
G) None of the above

Question 3

The owner of a take-out fried chicken and biscuits restaurant pays each month $2,500 in rent, $500 in utilities, $750 loan interest, $200 insurance premium, and $250 on local bus advertising. A bucket of chicken is priced at $9.50. Variable costs for the bucket are $5.50. How many buckets of chicken does the restaurant need to sell to break-even each month?

Accepted Answer

A)  442 buckets
B)  764 buckets
C)  1,050 buckets
D)  3,150 buckets
E)  4,200 bucketsF) B) and C)
G) All of the above

Question 4

The unit variable cost (UVC)  equals variable cost (VC)  divided by __________.

Accepted Answer

A)  quantity (Q) 
B)  fixed costs (F
C)  
C)  total cost (T
C)  
D)  total revenue (TR) 
E)  price per unit of the product (P) F) D) and E)
G) C) and E)

Question 5

The sum of the expenses of a firm that is stable and does not change with the quantity of the product that is produced and sold is referred to as

Accepted Answer

A)  fixed cost.
B)  total cost.
C)  variable cost.
D)  marginal cost.
E)  overhead cost.F) B) and D)
G) B) and C)

Question 6

A firm's profit objective is often measured in terms of ROI. The acronym ROI stands for __________.

Accepted Answer

A)  risk opportunity investment
B)  revised organizational incentives
C)  return on investment
D)  regulated organizational investments
E)  replenishment of organizational inventoriesF) A) and C)
G) A) and E)

Question 7

Setting the highest initial price that customers really desiring the product are willing to pay when introducing a new or innovative product is referred to as a

Accepted Answer

A)  skimming strategy.
B)  penetration strategy.
C)  price-lining strategy.
D)  experience-curve pricing strategy.
E)  prestige pricing strategy.F) A) and C)
G) A) and D)

Question 8

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) ...

Question 9

What is the difference between a movement along a demand curve and a shift of a demand curve?

Accepted Answer

A movement along a demand curve assumes ...

Question 10

Setting one price for all buyers of a product or service is referred to as __________.

Accepted Answer

A)  customary pricing
B)  a one-price policy
C)  a dynamic pricing policy
D)  standard markup pricing
E)  uniform pricingF) None of the above
G) C) and D)

Question 11

The key to setting a price for a product is finding an approximate price level to use as a reasonable starting point. Four common approaches to selecting an approximate price level are: (1)  demand-oriented; (2)  cost-oriented; (3)  __________; and (4)  competition-oriented approaches.

Accepted Answer

A)  stakeholder-oriented
B)  revenue-oriented
C)  profit-oriented
D)  distribution-oriented
E)  cause-orientedF) C) and D)
G) B) and D)

Question 12

Barter is the practice of exchanging products and services for other products and services rather than for __________.

Accepted Answer

A)  value
B)  ideas
C)  promises
D)  tariffs
E)  moneyF) B) and D)
G) None of the above

Question 13

The key to setting a final price for a product is finding an approximate price level to use as a reasonable starting point. Four common approaches to selecting an approximate price level are: (1)  demand-oriented; (2)  cost-oriented; (3)  profit-oriented; and (4)  __________ approaches.

Accepted Answer

A)  revenue-oriented
B)  distribution-oriented
C)  stakeholder-oriented
D)  competition-oriented
E)  cause-orientedF) B) and D)
G) B) and C)

Question 14

Price discrimination is illegal under the

Accepted Answer

A)  Sherman Act.
B)  Consumer Goods Pricing Act.
C)  Robinson-Patman Act.
D)  Federal Trade Commission Act.
E)  Anti-Competitive Act.F) A) and B)
G) B) and D)

Question 15

Two types of adjustments to list or quoted price are

Accepted Answer

A)  profit-oriented and marginal adjustments.
B)  fixed-price and dynamic price adjustments.
C)  discounts and marginal adjustments.
D)  discounts and allowances.
E)  incremental costs and incremental revenues.F) A) and D)
G) A) and E)

Question 16

A trade-in allowance refers to

Accepted Answer

A)  a noncash exchange of one product for another of equal or greater value.
B)  a cash-back payment when a more expensive item is replaced with a less expensive item.
C)  the return of money based on proof of purchase.
D)  a cash payment to a retailer for extra in-store support or special featuring of the brand.
E)  a price reduction given when a used product is part of the payment on a new product.F) A) and E)
G) A) and B)

Question 17

The ratio of perceived benefits to price is referred to as

Accepted Answer

A)  the price-quality relationship.
B)  customer value pricing.
C)  value-added pricing.
D)  value analysis.
E)  valuE.Key term definition - value.F) None of the above
G) A) and E)

Question 18

Which of the following statements regarding odd-even pricing is most accurate?

Accepted Answer

A)  Odd-even pricing is designed to give the consumer a better set of pricing alternatives.
B)  Odd-even pricing can be used in conjunction with a skimming pricing strategy, but should not be used with a penetration pricing strategy.
C)  Odd-even pricing does not work if the product is healthcare-related.
D)  Overuse of odd-ending prices tends to mute its effect on demand.
E)  Odd-ending prices are best used with large ticket items; it loses its effectiveness with moderate- to low-ticket items.F) C) and D)
G) D) and E)

Question 19

Deliberately selling a product below its customary price, not to increase sales, but to attract customers' attention in hopes that they will buy other products as well, is referred to as

Accepted Answer

A)  loss-leader pricing.
B)  bundle pricing.
C)  magnet pricing.
D)  predatory pricing.
E)  below-market pricing.F) A) and E)
G) A) and C)

Question 20

To increase value the most, marketers should

Accepted Answer

A)  decrease benefits.
B)  decrease benefits and increase price.
C)  decrease price and increase benefits.
D)  decrease price and decrease benefits.
E)  do nothing and let the perceived value of the item increase as it matures in its life cycleF) A) and C)
G) A) and E)

Exam 11: Pricing Products and Services

A firm's profit objective is often measured in terms of ROI. The acronym ROI stands for __________.

Correct Answer
verified

Price discrimination is illegal under the

Correct Answer
verified

A trade-in allowance refers to

Correct Answer
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The key to setting a price for a product is finding an approximate price level to use as a reasonable starting point. Four common approaches to selecting an approximate price level are: (1) demand-oriented; (2) cost-oriented; (3) __________; and (4) competition-oriented approaches.

Correct Answer
verified

Correct Answer
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The sum of the expenses of a firm that is stable and does not change with the quantity of the product that is produced and sold is referred to as

Correct Answer
verified

The use of special fees and surcharges is driven by consumers' zeal for __________ combined with the ease of making price comparisons on the Internet.

Correct Answer
verified

To increase value the most, marketers should

Correct Answer
verified

Which of the following statements regarding odd-even pricing is most accurate?

Correct Answer
verified

Setting one price for all buyers of a product or service is referred to as __________.

Correct Answer
verified

The ratio of perceived benefits to price is referred to as

Correct Answer
verified

Deliberately selling a product below its customary price, not to increase sales, but to attract customers' attention in hopes that they will buy other products as well, is referred to as

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) ...
View Answer

Two types of adjustments to list or quoted price are

Correct Answer
verified

Barter is the practice of exchanging products and services for other products and services rather than for __________.

Correct Answer
verified

Setting the highest initial price that customers really desiring the product are willing to pay when introducing a new or innovative product is referred to as a

Correct Answer
verified

What is the difference between a movement along a demand curve and a shift of a demand curve?

Correct Answer
verified
A movement along a demand curve assumes ...
View Answer

The unit variable cost (UVC) equals variable cost (VC) divided by __________.

Correct Answer
verified

Prestige pricing refers to

Correct Answer
verified

The key to setting a final price for a product is finding an approximate price level to use as a reasonable starting point. Four common approaches to selecting an approximate price level are: (1) demand-oriented; (2) cost-oriented; (3) profit-oriented; and (4) __________ approaches.

Correct Answer
verified

Exam 11: Pricing Products and Services

A firm's profit objective is often measured in terms of ROI. The acronym ROI stands for __________.

Correct AnswerverifiedShow Answer

Price discrimination is illegal under the

Correct AnswerverifiedShow Answer

A trade-in allowance refers to

Correct AnswerverifiedShow Answer

The key to setting a price for a product is finding an approximate price level to use as a reasonable starting point. Four common approaches to selecting an approximate price level are: (1) demand-oriented; (2) cost-oriented; (3) __________; and (4) competition-oriented approaches.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The sum of the expenses of a firm that is stable and does not change with the quantity of the product that is produced and sold is referred to as

Correct AnswerverifiedShow Answer

The use of special fees and surcharges is driven by consumers' zeal for __________ combined with the ease of making price comparisons on the Internet.

Correct AnswerverifiedShow Answer

To increase value the most, marketers should

Correct AnswerverifiedShow Answer

Which of the following statements regarding odd-even pricing is most accurate?

Correct AnswerverifiedShow Answer

Setting one price for all buyers of a product or service is referred to as __________.

Correct AnswerverifiedShow Answer

The ratio of perceived benefits to price is referred to as

Correct AnswerverifiedShow Answer

Deliberately selling a product below its customary price, not to increase sales, but to attract customers' attention in hopes that they will buy other products as well, is referred to as

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) ...View AnswerShow Answer

Two types of adjustments to list or quoted price are

Correct AnswerverifiedShow Answer

Barter is the practice of exchanging products and services for other products and services rather than for __________.

Correct AnswerverifiedShow Answer

Setting the highest initial price that customers really desiring the product are willing to pay when introducing a new or innovative product is referred to as a

Correct AnswerverifiedShow Answer

What is the difference between a movement along a demand curve and a shift of a demand curve?

Correct AnswerverifiedA movement along a demand curve assumes ...View AnswerShow Answer

The unit variable cost (UVC) equals variable cost (VC) divided by __________.

Correct AnswerverifiedShow Answer

Prestige pricing refers to

Correct AnswerverifiedShow Answer

The key to setting a final price for a product is finding an approximate price level to use as a reasonable starting point. Four common approaches to selecting an approximate price level are: (1) demand-oriented; (2) cost-oriented; (3) profit-oriented; and (4) __________ approaches.

Correct AnswerverifiedShow Answer

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

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A movement along a demand curve assumes ...
View Answer

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