Question 1

Prestige objectives reflect marketers' recognition of the role of price in creating an overall image of the firm and its product offerings.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is an example of a volume pricing objective?

Accepted Answer

A)  Setting price in line or on parity with competition 
B)  Emphasizing the benefits or value a product provides 
C)  Reducing price to gain a higher share of the market 
D)  Establishing a relatively high price to create a high quality image 
A)  Setting price in line or on parity with competition 
B)  Emphasizing the benefits or value a product provides 
C)  Reducing price to gain a higher share of the market 
D)  Establishing a relatively high price to create a high quality image

Question 3

There are a variety of pricing strategies available to firms. For example, firms selling perishable goods - such as a produce shop - might want to make sure all the inventory is sold. This firm would likely have a

Accepted Answer

A)  sales volume objective. 
B)  competition objective. 
C)  prestige objective. 
D)  loss avoidance objective. 
A)  sales volume objective. 
B)  competition objective. 
C)  prestige objective. 
D)  loss avoidance objective.

Question 4

When a company sells its goods or services at a price less than the overall costs, the company incurs a:

Accepted Answer

A)  loss. 
B)  profit. 
C)  contribution margin. 
D)  negative transaction. 
A)  loss. 
B)  profit. 
C)  contribution margin. 
D)  negative transaction.

Question 5

Selling price of the product minus the variable cost of the product yields:

Accepted Answer

A)  contribution margin. 
B)  profit. 
C)  fixed cost. 
D)  loss. 
A)  contribution margin. 
B)  profit. 
C)  fixed cost. 
D)  loss.

Question 6

A five-pound bag of roasted peanuts sells for $8, and the average variable cost is $4 per bag. If the total fixed cost for the roasted peanuts is $80,000, the breakeven point in bags is:

Accepted Answer

A)  20,000 
B)  40,000 
C)  80,000 
D)  120,000 
A)  20,000 
B)  40,000 
C)  80,000 
D)  120,000

Question 7

A shortcoming of the breakeven model is that it assumes that per-unit variable costs change at different levels of operation.

Accepted Answer

A) True 
 B)False

Question 8

MycroFiber is a producer of microfiber material for the auto detailing industry. Jamal, the owner of MycroFiber is highly skilled in the technical and manufacturing areas, but does not understand pricing. Jamal knows he wants to cover the cost of production when selling his material and needs revenue to cover his overhead costs and to make a profit. To be sure he meets these goals, Jamal decides to take a cost-based pricing approach and wants to achieve a 50% margin on sales. If MycroFiber's cost of production is $4 a square yard, Jamal will price his material at:

Accepted Answer

A)  $8 a square yard. 
B)  $6 a square yard. 
C)  $4 a square yard. 
D)  $2 a square yard. 
A)  $8 a square yard. 
B)  $6 a square yard. 
C)  $4 a square yard. 
D)  $2 a square yard.

Question 9

While variable costs change with level of production, they always stay the same per unit regardless of the level of production. For example, if the variables cost of making an item are $10 when producing 100 units, they will stay $10 each when 500 or 1000 units are produced.

Accepted Answer

A) True 
 B)False

Question 10

MycroFiber is a producer of microfiber material for the auto detailing industry. Jamal, the owner of MycroFiber is highly skilled in the technical and manufacturing areas, but does not understand pricing. Jamal knows he wants to cover the cost of production when selling his material and needs revenue to cover his overhead costs and to make a profit. To be sure he meets these goals, Jamal decides to take a cost-based pricing approach by calculating the cost of production and adding a(n) ________.

Accepted Answer

A)  markup percentage 
B)  cost adjustment 
C)  operating profit 
D)  discount rate 
A)  markup percentage 
B)  cost adjustment 
C)  operating profit 
D)  discount rate

Question 11

An organization's total costs are typically divided into:

Accepted Answer

A)  variable costs and fixed costs. 
B)  liabilities and assets. 
C)  expenses and revenues. 
D)  salaries and overhead. 
A)  variable costs and fixed costs. 
B)  liabilities and assets. 
C)  expenses and revenues. 
D)  salaries and overhead.

Question 12

Mignon d'Armitage manufactures jewelry. This firm is planning to introduce a new necklace and is trying to determine how many units it must sell in order to break even. Fixed costs are $100,000 and variable costs for each unit will be $20. At the price of $45 each, the number of units that must be sold in order to break even is:

Accepted Answer

A)  2,500. 
B)  4,000. 
C)  5,000. 
D)  7,500. 
A)  2,500. 
B)  4,000. 
C)  5,000. 
D)  7,500.

Question 13

Jayce is searching for a ticket home from college for semester break. While he has checked several websites and all the airlines that fly the route he will take, it seems like every airline is charging the same price. It appears that the airlines are using:

Accepted Answer

A)  competitive parity pricing. 
B)  value pricing. 
C)  market-based pricing. 
D)  cost-plus pricing. 
A)  competitive parity pricing. 
B)  value pricing. 
C)  market-based pricing. 
D)  cost-plus pricing.

Prestige objectives reflect marketers' recognition of the role of price in creating an overall image of the firm and its product offerings.

Which of the following is an example of a volume pricing objective?

There are a variety of pricing strategies available to firms. For example, firms selling perishable goods - such as a produce shop - might want to make sure all the inventory is sold. This firm would likely have a

When a company sells its goods or services at a price less than the overall costs, the company incurs a:

Selling price of the product minus the variable cost of the product yields:

A five-pound bag of roasted peanuts sells for $8, and the average variable cost is $4 per bag. If the total fixed cost for the roasted peanuts is $80,000, the breakeven point in bags is:

A shortcoming of the breakeven model is that it assumes that per-unit variable costs change at different levels of operation.

While variable costs change with level of production, they always stay the same per unit regardless of the level of production. For example, if the variables cost of making an item are $10 when producing 100 units, they will stay $10 each when 500 or 1000 units are produced.

An organization's total costs are typically divided into:

Jayce is searching for a ticket home from college for semester break. While he has checked several websites and all the airlines that fly the route he will take, it seems like every airline is charging the same price. It appears that the airlines are using:

Marketing: the Art of Satisfying Customers

Strategic Planning in Contemporary Marketing

The Marketing Environment, Ethics, and Social Responsibility

E-Business: Managing the Customer Experience

Social Media: Living in the Connected World

Consumer Behavior

Business Markets and Buying Behavior

Global Marketing

Market Segmentation, Targeting, and Positioning

Marketing Research

Product and Branding Concepts

Developing and Managing Products

Pricing Strategies

Distribution Channels and Supply Chain Management

Retailing and Direct Marketing

Integrated Marketing Communications

Personal Selling and Sales Promotion

Creating A Marketing Plan

Financial Analysis In Marketing

Your Career In Marketing

Filters

Exam 13: Pricing Concepts

Prestige objectives reflect marketers' recognition of the role of price in creating an overall image of the firm and its product offerings.

Which of the following is an example of a volume pricing objective?

There are a variety of pricing strategies available to firms. For example, firms selling perishable goods - such as a produce shop - might want to make sure all the inventory is sold. This firm would likely have a

When a company sells its goods or services at a price less than the overall costs, the company incurs a:

Selling price of the product minus the variable cost of the product yields:

A five-pound bag of roasted peanuts sells for $8, and the average variable cost is $4 per bag. If the total fixed cost for the roasted peanuts is $80,000, the breakeven point in bags is:

A shortcoming of the breakeven model is that it assumes that per-unit variable costs change at different levels of operation.

While variable costs change with level of production, they always stay the same per unit regardless of the level of production. For example, if the variables cost of making an item are $10 when producing 100 units, they will stay $10 each when 500 or 1000 units are produced.

An organization's total costs are typically divided into:

Jayce is searching for a ticket home from college for semester break. While he has checked several websites and all the airlines that fly the route he will take, it seems like every airline is charging the same price. It appears that the airlines are using:

Marketing: the Art of Satisfying Customers

Strategic Planning in Contemporary Marketing

The Marketing Environment, Ethics, and Social Responsibility

E-Business: Managing the Customer Experience

Social Media: Living in the Connected World

Consumer Behavior

Business Markets and Buying Behavior

Global Marketing

Market Segmentation, Targeting, and Positioning

Marketing Research

Product and Branding Concepts

Developing and Managing Products

Pricing Strategies

Distribution Channels and Supply Chain Management

Retailing and Direct Marketing

Integrated Marketing Communications

Personal Selling and Sales Promotion

Creating A Marketing Plan

Financial Analysis In Marketing

Your Career In Marketing

Filters