Question 1

________ pricing is a practical approach to use when a company has high fixed costs and unused production capacity.

Accepted Answer

A)  Full-cost 
B)  Cost-plus 
C)  Marginal-cost 
D)  Demand-based 
E)  Premium 
A)  Full-cost 
B)  Cost-plus 
C)  Marginal-cost 
D)  Demand-based 
E)  Premium C

Question 2

________ duties are levied as a percentage of the value of the goods imported.

Accepted Answer

A)  Specific 
B)  Protective 
C)  Prohibitive 
D)  Ad valorem 
E)  Compound 
A)  Specific 
B)  Protective 
C)  Prohibitive 
D)  Ad valorem 
E)  Compound D

Question 3

A company uses ________ when the objective is to reach a segment of the market that is relatively price insensitive and thus willing to pay a premium price for the value received.

Accepted Answer

A)  penetration pricing 
B)  everyday low pricing 
C)  predatory pricing 
D)  price skimming 
E)  psychological pricing 
A)  penetration pricing 
B)  everyday low pricing 
C)  predatory pricing 
D)  price skimming 
E)  psychological pricing D

Question 4

What is most likely to be true of a company that views prices as an active instrument of accomplishing marketing objectives?

Accepted Answer

A)  The company sets prices to achieve specific objectives. 
B)  The company follows market prices to achieve specific objectives. 
C)  The company exports only excess inventory. 
D)  The company views its export sales as an insignificant source of revenue. 
E)  The company places a low priority on foreign business. 
A)  The company sets prices to achieve specific objectives. 
B)  The company follows market prices to achieve specific objectives. 
C)  The company exports only excess inventory. 
D)  The company views its export sales as an insignificant source of revenue. 
E)  The company places a low priority on foreign business.

Question 5

In ________, a company has an ongoing relationship with a bank that routinely buys its short-term accounts receivable at a discount.

Accepted Answer

A)  forfaiting 
B)  factoring 
C)  a barter transaction 
D)  a cash-in-advance transaction 
E)  an open accounts transaction 
A)  forfaiting 
B)  factoring 
C)  a barter transaction 
D)  a cash-in-advance transaction 
E)  an open accounts transaction

Question 6

Assuming that an international marketer has produced the right product, used the proper channel of distribution, and promoted the goods correctly, the effort will fail if the international marketer fails to

Accepted Answer

A)  inform the host government about all its marketing objectives. 
B)  set the right price for the goods or services. 
C)  set the import tariff for the goods or services. 
D)  form a joint venture in order to sell the product. 
E)  work on a franchise basis in the country. 
A)  inform the host government about all its marketing objectives. 
B)  set the right price for the goods or services. 
C)  set the import tariff for the goods or services. 
D)  form a joint venture in order to sell the product. 
E)  work on a franchise basis in the country.

Question 7

In bills of exchange, the buyer assumes all the risk until the payment is made.

Accepted Answer

A) True 
 B)False

Question 8

Sales on open accounts are recommended when shipping is hazardous.

Accepted Answer

A) True 
 B)False

Question 9

What is administered pricing, and how does it differ from price fixing? How is it arranged in international markets?

Accepted Answer

Administered pricing is an attempt to es

Question 10

What would be considered an advantage of leasing equipment rather than owning it?

Accepted Answer

A)  Lease revenue tends to fluctuate greatly. 
B)  Leased equipment rarely breaks down. 
C)  Leasing helps guarantee better maintenance on overseas equipment. 
D)  Leasing keeps companies from using experimental equipment. 
E)  Leasing is less risky than outright sale of equipment. 
A)  Lease revenue tends to fluctuate greatly. 
B)  Leased equipment rarely breaks down. 
C)  Leasing helps guarantee better maintenance on overseas equipment. 
D)  Leasing keeps companies from using experimental equipment. 
E)  Leasing is less risky than outright sale of equipment.

Question 11

Except for cash in advance, letters of credit afford the greatest degree of protection for the seller.

Accepted Answer

A) True 
 B)False

Question 12

An irrevocable, confirmed letter of credit means that a U.S. bank accepts responsibility to pay the seller regardless of the financial situation of the buyer or foreign bank.

Accepted Answer

A) True 
 B)False

Question 13

________ are the primary outside source of aid for companies affected by the uncertainty of a countertrade.

Accepted Answer

A)  Trade unions 
B)  Barter houses 
C)  Industry associations 
D)  Swap centers 
E)  Satellite towns 
A)  Trade unions 
B)  Barter houses 
C)  Industry associations 
D)  Swap centers 
E)  Satellite towns

Question 14

What is a countertrade? What are the advantages and disadvantages of countertrading?

Accepted Answer

Countertrade is a pricing tool that ever

Question 15

When the U.S. dollar strengthens, U.S. exports will decrease.

Accepted Answer

A) True 
 B)False

Question 16

In a(n) ________ transaction, the seller makes a one-time arrangement with a bank or other financial institution to take over responsibility for collecting the account receivable.

Accepted Answer

A)  forfaiting 
B)  factoring 
C)  barter 
D)  cash-in-advance payment 
E)  open account 
A)  forfaiting 
B)  factoring 
C)  barter 
D)  cash-in-advance payment 
E)  open account

Question 17

A ________, which shifts the buyer's credit risk to the bank, is not a guarantee of payment to the seller. Rather, payment is tendered only if the seller complies exactly with its terms.

Accepted Answer

A)  open account 
B)  letter of credit 
C)  bill of lading 
D)  bill of regression 
E)  credit agreement 
A)  open account 
B)  letter of credit 
C)  bill of lading 
D)  bill of regression 
E)  credit agreement

Question 18

What is the most probable reason a manufacturer would choose to conduct its manufacturing operations in a third country?

Accepted Answer

A)  to standardize middlemen margins 
B)  to reduce the credit risk of the seller 
C)  to increase the capital-labor ratio 
D)  to avoid antidumping duties 
E)  to reduce manufacturing costs 
A)  to standardize middlemen margins 
B)  to reduce the credit risk of the seller 
C)  to increase the capital-labor ratio 
D)  to avoid antidumping duties 
E)  to reduce manufacturing costs

Question 19

What characterizes the variable-cost pricing approach?

Accepted Answer

A)  Prices are often set on a cost-plus basis, that is, total costs plus a profit margin. 
B)  No unit of a similar product is different from any other unit in terms of cost. 
C)  Each unit must bear its full share of the total fixed and variable cost. 
D)  This approach is suitable when a company has high variable costs relative to its fixed costs. 
E)  Any contribution to fixed cost after variable costs are covered is profit to the company. 
A)  Prices are often set on a cost-plus basis, that is, total costs plus a profit margin. 
B)  No unit of a similar product is different from any other unit in terms of cost. 
C)  Each unit must bear its full share of the total fixed and variable cost. 
D)  This approach is suitable when a company has high variable costs relative to its fixed costs. 
E)  Any contribution to fixed cost after variable costs are covered is profit to the company.

Question 20

A marketer may face lower costs by shipping unassembled goods to a free trade zone (FTZ) in an importing country because

Accepted Answer

A)  locally produced components may not be used in production. 
B)  labor costs may be lower in the importing country. 
C)  FTZs levy higher taxes and surcharges on imported goods. 
D)  ocean transportation rates may not be affected by the weight and volume of the components. 
E)  duties may be assessed at a higher rate for unassembled goods. 
A)  locally produced components may not be used in production. 
B)  labor costs may be lower in the importing country. 
C)  FTZs levy higher taxes and surcharges on imported goods. 
D)  ocean transportation rates may not be affected by the weight and volume of the components. 
E)  duties may be assessed at a higher rate for unassembled goods.

________ pricing is a practical approach to use when a company has high fixed costs and unused production capacity.

________ duties are levied as a percentage of the value of the goods imported.

A company uses ________ when the objective is to reach a segment of the market that is relatively price insensitive and thus willing to pay a premium price for the value received.

What is most likely to be true of a company that views prices as an active instrument of accomplishing marketing objectives?

In ________, a company has an ongoing relationship with a bank that routinely buys its short-term accounts receivable at a discount.

Assuming that an international marketer has produced the right product, used the proper channel of distribution, and promoted the goods correctly, the effort will fail if the international marketer fails to

In bills of exchange, the buyer assumes all the risk until the payment is made.

Sales on open accounts are recommended when shipping is hazardous.

What is administered pricing, and how does it differ from price fixing? How is it arranged in international markets?

What would be considered an advantage of leasing equipment rather than owning it?

Except for cash in advance, letters of credit afford the greatest degree of protection for the seller.

An irrevocable, confirmed letter of credit means that a U.S. bank accepts responsibility to pay the seller regardless of the financial situation of the buyer or foreign bank.

________ are the primary outside source of aid for companies affected by the uncertainty of a countertrade.

What is a countertrade? What are the advantages and disadvantages of countertrading?

When the U.S. dollar strengthens, U.S. exports will decrease.

In a(n) ________ transaction, the seller makes a one-time arrangement with a bank or other financial institution to take over responsibility for collecting the account receivable.

A ________, which shifts the buyer's credit risk to the bank, is not a guarantee of payment to the seller. Rather, payment is tendered only if the seller complies exactly with its terms.

What is the most probable reason a manufacturer would choose to conduct its manufacturing operations in a third country?

What characterizes the variable-cost pricing approach?

A marketer may face lower costs by shipping unassembled goods to a free trade zone (FTZ) in an importing country because

The Scope and Challenge of International Marketing

The Dynamic Environment of International Trade

History and Geography: the Foundations of Culture

Cultural Dynamics in Assessing Global Markets

Culture, Management Style, and Business Systems

The Political Environment: a Critical Concern

The International Legal Environment: Playing by the Rules

Developing a Global Vision Through Marketing Research

Economic Development and the Americas

Europe, Africa, and the Middle East

The Asia Pacific Region

Global Marketing Management: Planning and Organization

Products and Services for Consumers

Products and Services for Businesses

International Marketing Channels

Integrated Marketing Communications and International Advertising

Personal Selling and Sales Management

Inventive Negotiations With International Customers, Partners, and Regulators

Filters

Exam 18: Pricing for International Markets

________ pricing is a practical approach to use when a company has high fixed costs and unused production capacity.

________ duties are levied as a percentage of the value of the goods imported.

A company uses ________ when the objective is to reach a segment of the market that is relatively price insensitive and thus willing to pay a premium price for the value received.

What is most likely to be true of a company that views prices as an active instrument of accomplishing marketing objectives?

In ________, a company has an ongoing relationship with a bank that routinely buys its short-term accounts receivable at a discount.

Assuming that an international marketer has produced the right product, used the proper channel of distribution, and promoted the goods correctly, the effort will fail if the international marketer fails to

In bills of exchange, the buyer assumes all the risk until the payment is made.

Sales on open accounts are recommended when shipping is hazardous.

What is administered pricing, and how does it differ from price fixing? How is it arranged in international markets?

What would be considered an advantage of leasing equipment rather than owning it?

Except for cash in advance, letters of credit afford the greatest degree of protection for the seller.

An irrevocable, confirmed letter of credit means that a U.S. bank accepts responsibility to pay the seller regardless of the financial situation of the buyer or foreign bank.

________ are the primary outside source of aid for companies affected by the uncertainty of a countertrade.

What is a countertrade? What are the advantages and disadvantages of countertrading?

When the U.S. dollar strengthens, U.S. exports will decrease.

In a(n) ________ transaction, the seller makes a one-time arrangement with a bank or other financial institution to take over responsibility for collecting the account receivable.

A ________, which shifts the buyer's credit risk to the bank, is not a guarantee of payment to the seller. Rather, payment is tendered only if the seller complies exactly with its terms.

What is the most probable reason a manufacturer would choose to conduct its manufacturing operations in a third country?

What characterizes the variable-cost pricing approach?

A marketer may face lower costs by shipping unassembled goods to a free trade zone (FTZ) in an importing country because

The Scope and Challenge of International Marketing

The Dynamic Environment of International Trade

History and Geography: the Foundations of Culture

Cultural Dynamics in Assessing Global Markets

Culture, Management Style, and Business Systems

The Political Environment: a Critical Concern

The International Legal Environment: Playing by the Rules

Developing a Global Vision Through Marketing Research

Economic Development and the Americas

Europe, Africa, and the Middle East

The Asia Pacific Region

Global Marketing Management: Planning and Organization

Products and Services for Consumers

Products and Services for Businesses

International Marketing Channels

Integrated Marketing Communications and International Advertising

Personal Selling and Sales Management

Inventive Negotiations With International Customers, Partners, and Regulators

Filters