Question 1

Briefly describe the different types of pricing objectives.

Accepted Answer

When a company is preparing to sets its

Question 2

Starbucks,OSIM,and BMW have been able to position themselves within their categories by combining quality,luxury,and premium prices with an intensely loyal customer base.These companies are employing a ________ strategy.

Accepted Answer

A) market-skimming 
B) market-penetration 
C) survival 
D) market share maximization 
E) product-quality leadership 
A) market-skimming 
B) market-penetration 
C) survival 
D) market share maximization 
E) product-quality leadership

Question 3

Escalator clauses are found in contracts for major industrial projects,such as aircraft construction and bridge building.

Accepted Answer

A) True 
 B)False

Question 4

What are the different types of price discounts and allowances?

Accepted Answer

The different types of price discounts a

Question 5

NV Inc.has launched a touch-sensitive handset in the Indian market and priced it at INR 9500.Although many people are checking it out and showing interest about purchasing it,majority of them are holding themselves back because they feel that it is not worth INR 9500.They compare the handsets' feature with that of its other competitors offering the same features and come to a conclusion that it is worth INR 8500 and nothing more than that.What kind of a reference price are the consumers using?

Accepted Answer

The consumers are using the up

Question 6

In ________,the seller charges different amounts to different classes of buyers.

Accepted Answer

A) perceived value pricing 
B) third-degree price discrimination 
C) first-degree price discrimination 
D) second-degree price discrimination 
E) psychological discounting 
A) perceived value pricing 
B) third-degree price discrimination 
C) first-degree price discrimination 
D) second-degree price discrimination 
E) psychological discounting

Question 7

Companies strive to maximize their current profits if they are plagued with overcapacity,intense competition,or changing consumer wants.

Accepted Answer

A) True 
 B)False

Question 8

A manufacturer has invested $750,000 in a new product and wants to set a price to earn a 15 percent ROI.The cost per unit is $18 and the company expects to sell 50,000 units in the first year.Calculate the company's target-return price for this product.

Accepted Answer

A) $20.25 
B) $18.23 
C) $18.10 
D) $20.70 
E) $25.50 
A) $20.25 
B) $18.23 
C) $18.10 
D) $20.70 
E) $25.50

Question 9

When a company maintains its price but removes or prices separately one or more elements that were part of the former offer,such as free delivery or installation,it is known as ________.

Accepted Answer

A) escalating 
B) differentiation 
C) unbundling 
D) reverse discounting 
E) delayed quotation pricing 
A) escalating 
B) differentiation 
C) unbundling 
D) reverse discounting 
E) delayed quotation pricing

Question 10

Despite its weaknesses,markup pricing remains popular for which of the following reasons?

Accepted Answer

A) Sellers can determine demand much more easily than they can estimate costs. 
B) By tying the price to cost,the pricing task becomes more sophisticated. 
C) When all firms in the industry use markup pricing,price competition flourishes. 
D) Sellers take advantage of buyers when the latter's demand becomes acute. 
E) Many people feel that cost-plus pricing is fairer to both buyers and sellers. 
A) Sellers can determine demand much more easily than they can estimate costs. 
B) By tying the price to cost,the pricing task becomes more sophisticated. 
C) When all firms in the industry use markup pricing,price competition flourishes. 
D) Sellers take advantage of buyers when the latter's demand becomes acute. 
E) Many people feel that cost-plus pricing is fairer to both buyers and sellers.

Question 11

Companies that aim to ________ strive to be affordable luxuries.

Accepted Answer

A) survive in the market 
B) partially recover their costs 
C) maximize their market share 
D) pursue value pricing 
E) be product-quality leaders 
A) survive in the market 
B) partially recover their costs 
C) maximize their market share 
D) pursue value pricing 
E) be product-quality leaders

Question 12

ROC Engineering,a Chinese shipbuilding company,agrees to build a fleet of submarines for the Sri Lankan navy,for which it will be paid in the local Sri Lankan currency.As per the agreement,ROC must also spend a substantial amount of the money it generates through this deal within the country.In accordance with the contract,ROC buys Sri Lankan tea at a reduced rate.This is an example of which of the following forms of countertrade?

Accepted Answer

A) descending bid 
B) offset 
C) barter 
D) compensation deal 
E) buyback arrangement 
A) descending bid 
B) offset 
C) barter 
D) compensation deal 
E) buyback arrangement

Question 13

Loss leader pricing dilutes a company's brand image.

Accepted Answer

A) True 
 B)False

Question 14

Companies prefer customers who are less price-sensitive.

Accepted Answer

A) True 
 B)False

Question 15

When higher-priced competitors match the lower prices but have longer staying power because of deeper cash reserves,it leads to a(n)________.

Accepted Answer

A) low-quality trap 
B) fragile-market-share trap 
C) price war trap 
D) escalator trap 
E) shallow-pockets trap 
A) low-quality trap 
B) fragile-market-share trap 
C) price war trap 
D) escalator trap 
E) shallow-pockets trap

Question 16

Predatory pricing,which refers to the concept of selling below cost with the intention of destroying competition,is lawful under certain conditions.

Accepted Answer

A) True 
 B)False

Question 17

In the case of prestige goods,the demand curve sometimes slopes upward.

Accepted Answer

A) True 
 B)False

Question 18

________ pricing takes into account a host of inputs,such as the buyer's image of the product performance,the channel deliverables,the warranty quality,customer support,and attributes such as the supplier's reputation,trustworthiness,and esteem.

Accepted Answer

A) Perceived-value 
B) Value 
C) Going-rate 
D) Auction-type 
E) Markup 
A) Perceived-value 
B) Value 
C) Going-rate 
D) Auction-type 
E) Markup

Question 19

What are the different price-setting methods? Briefly describe each of them.

Accepted Answer

The six major price-setting methods are:

Question 20

If demand changes considerably,with a small change in price,the demand is said to be ________.

Accepted Answer

A) unit elastic 
B) elastic 
C) inelastic 
D) marginal 
E) strained 
A) unit elastic 
B) elastic 
C) inelastic 
D) marginal 
E) strained

Exam 14: Developing Pricing Strategies and Programs

Briefly describe the different types of pricing objectives.

Starbucks,OSIM,and BMW have been able to position themselves within their categories by combining quality,luxury,and premium prices with an intensely loyal customer base.These companies are employing a ________ strategy.

Escalator clauses are found in contracts for major industrial projects,such as aircraft construction and bridge building.

What are the different types of price discounts and allowances?

In ________,the seller charges different amounts to different classes of buyers.

Companies strive to maximize their current profits if they are plagued with overcapacity,intense competition,or changing consumer wants.

A manufacturer has invested $750,000 in a new product and wants to set a price to earn a 15 percent ROI.The cost per unit is $18 and the company expects to sell 50,000 units in the first year.Calculate the company's target-return price for this product.

When a company maintains its price but removes or prices separately one or more elements that were part of the former offer,such as free delivery or installation,it is known as ________.

Despite its weaknesses,markup pricing remains popular for which of the following reasons?

Companies that aim to ________ strive to be affordable luxuries.

Loss leader pricing dilutes a company's brand image.

Companies prefer customers who are less price-sensitive.

When higher-priced competitors match the lower prices but have longer staying power because of deeper cash reserves,it leads to a(n)________.

Predatory pricing,which refers to the concept of selling below cost with the intention of destroying competition,is lawful under certain conditions.

In the case of prestige goods,the demand curve sometimes slopes upward.

________ pricing takes into account a host of inputs,such as the buyer's image of the product performance,the channel deliverables,the warranty quality,customer support,and attributes such as the supplier's reputation,trustworthiness,and esteem.

What are the different price-setting methods? Briefly describe each of them.

If demand changes considerably,with a small change in price,the demand is said to be ________.

Defining Marketing for the New Realities

Developing Marketing Strategies and Plans

Gathering Information and Forecasting Demand

Conducting Marketing Research

Creating Customer Value,satisfaction,and Loyalty

Analyzing Consumer Markets

Analyzing Business Markets

Identifying Market Segments and Targets

Creating Brand Equity

Crafting the Brand Positioning

Competitive Dynamics

Setting Product Strategy

Designing and Managing Services

Designing and Managing Marketing Channels and Value Networks

Managing Retailing,wholesaling,and Logistics

Designing and Managing Integrated Marketing Communications

Managing Mass Communications: Advertising, sales Promotions, events, and Public Relations

Managing Digital Communications: Online, social Media, and Mobile

Managing Personal Communications: Direct and Database Marketing and Personal Selling

Introducing New Market Offerings

Tapping Into Global Markets

Managing a Holistic Marketing Organization

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