Question 1

Because odd prices are associated with low prices,they are typically used by retailers who sell at prices below the market or at the market.

Accepted Answer

A) True 
 B)False

Question 2

The practice of advertising a low-priced model of a shopping good which the retailer has no intention of selling,in order to lure shoppers into a store is called "trading up."

Accepted Answer

A) True 
 B)False

Question 3

Your local bike shop offers a wide variety of bicycles at the following price levels: $99.99,$160.99,$320.95,$619.99,and $1039.99.The bike shop is using a _____ pricing strategy.

Accepted Answer

A)  variable 
B)  price lining 
C)  standard price mix 
D)  stream lining 
E)  flexible 
A)  variable 
B)  price lining 
C)  standard price mix 
D)  stream lining 
E)  flexible

Question 4

Pricing policies are rules of action,or guidelines,that ensure uniformity of pricing decisions within a retail operation.

Accepted Answer

A) True 
 B)False

Question 5

For leader pricing to be effective,which of the following guidelines should be followed?

Accepted Answer

A)  Not many customers should actually want to buy the leader item. 
B)  The leader item must have had a very high markup before being discounted. 
C)  The leader item must have narrow appeal within the retailer's target market. 
D)  The leader item must be an item frequently purchased by the consumer. 
E)  It should never be sold below cost. 
A)  Not many customers should actually want to buy the leader item. 
B)  The leader item must have had a very high markup before being discounted. 
C)  The leader item must have narrow appeal within the retailer's target market. 
D)  The leader item must be an item frequently purchased by the consumer. 
E)  It should never be sold below cost.

Question 6

Retailers that wish to have greater pricing freedom are likely to carry private brands because consumers find it difficult to make exact comparisons between private brands and national brands.

Accepted Answer

A) True 
 B)False

Question 7

A(n)_____ pricing policy is a policy that regularly discounts merchandise from the established market price in order to build store traffic,generate high sales,and enhance gross margin dollars per square foot of selling space.

Accepted Answer

A)  above-market 
B)  flexible 
C)  odd-pricing 
D)  below-market 
E)  loss leader 
A)  above-market 
B)  flexible 
C)  odd-pricing 
D)  below-market 
E)  loss leader

Question 8

Markdowns are always the result of buyer errors.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following situations is NOT a good reason for using a high markup percentage?

Accepted Answer

A)  The products have a high risk of a price reduction due to the seasonality of the goods 
B)  The products have low fixed costs associated with their sale 
C)  The products have a low elasticity of demand 
D)  The products have high handling and storage costs 
E)  The products are only sold through few retail outlets 
A)  The products have a high risk of a price reduction due to the seasonality of the goods 
B)  The products have low fixed costs associated with their sale 
C)  The products have a low elasticity of demand 
D)  The products have high handling and storage costs 
E)  The products are only sold through few retail outlets

Question 10

What factors should a retailer consider when deciding whether to price above the market,price at market levels,or price below the market?

Accepted Answer

Pricing Below the Market: A below-market

Question 11

The maintained markup percentage equals the retailer's initial markup percentage minus its reduction percentage multiplied by 100 percent minus its initial markup percentage.

Accepted Answer

A) True 
 B)False

Question 12

As a rule,if a retailer wants to attract customers from a greater it must_____ its merchandise.

Accepted Answer

A)  lower the prices of 
B)  double both its prices and promotion of 
C)  deemphasize the services it provides with 
D)  increase the services provided the customer and reduce the promotional activities associated with 
E)  reduce the promotional activities associated with 
A)  lower the prices of 
B)  double both its prices and promotion of 
C)  deemphasize the services it provides with 
D)  increase the services provided the customer and reduce the promotional activities associated with 
E)  reduce the promotional activities associated with

Question 13

A one-price policy speeds the amount of time needed to complete a customer transaction.

Accepted Answer

A) True 
 B)False

Question 14

The practice of advertising a low-priced model of a shopping good to lure shoppers into a store is called a bait-and-switch pricing.

Accepted Answer

A) True 
 B)False

Question 15

Mike's Appliances bought a refrigerator for $480.The initial price on the refrigerator was $950,but it was ultimately sold for $825.What were initial and maintained markups,respectively?

Accepted Answer

A)  36.3 percent; 57.0 percent 
B)  46.3 percent; 58.2 percent 
C)  49.5 percent; 41.8 percent 
D)  50.5 percent; 58.2 percent 
E)  63.7 percent; 43.0 percent 
A)  36.3 percent; 57.0 percent 
B)  46.3 percent; 58.2 percent 
C)  49.5 percent; 41.8 percent 
D)  50.5 percent; 58.2 percent 
E)  63.7 percent; 43.0 percent

Question 16

A _____ is a range of prices for a specific merchandise line that appeals to customers in a certain demographic group.

Accepted Answer

A)  price zone 
B)  odd price 
C)  price line 
D)  price point 
E)  price range 
A)  price zone 
B)  odd price 
C)  price line 
D)  price point 
E)  price range

Question 17

Retailers use multiple-unit pricing to encourage additional sales and to increase profits.

Accepted Answer

A) True 
 B)False

Question 18

A _____ objective is a pricing objective that states a specific level of profit,such a as percentage of sales or a return on capital invested,as an objective.

Accepted Answer

A)  profit maximization 
B)  target-return 
C)  percentage-of-sales 
D)  competition-oriented 
E)  skimming 
A)  profit maximization 
B)  target-return 
C)  percentage-of-sales 
D)  competition-oriented 
E)  skimming

Question 19

A major advantage of the penetration objective is that it helps to establish a loyal customer base.

Accepted Answer

A) True 
 B)False

Question 20

Flowers tend to be priced higher when demand is greatest,around Mother's Day and Valentine's Day.This is an example of _____ pricing.

Accepted Answer

A)  flexible 
B)  dynamic 
C)  psychological 
D)  variable 
E)  customary 
A)  flexible 
B)  dynamic 
C)  psychological 
D)  variable 
E)  customary

Because odd prices are associated with low prices,they are typically used by retailers who sell at prices below the market or at the market.

The practice of advertising a low-priced model of a shopping good which the retailer has no intention of selling,in order to lure shoppers into a store is called "trading up."

Your local bike shop offers a wide variety of bicycles at the following price levels: $99.99,$160.99,$320.95,$619.99,and $1039.99.The bike shop is using a _____ pricing strategy.

Pricing policies are rules of action,or guidelines,that ensure uniformity of pricing decisions within a retail operation.

For leader pricing to be effective,which of the following guidelines should be followed?

Retailers that wish to have greater pricing freedom are likely to carry private brands because consumers find it difficult to make exact comparisons between private brands and national brands.

A(n)_____ pricing policy is a policy that regularly discounts merchandise from the established market price in order to build store traffic,generate high sales,and enhance gross margin dollars per square foot of selling space.

Markdowns are always the result of buyer errors.

Which of the following situations is NOT a good reason for using a high markup percentage?

What factors should a retailer consider when deciding whether to price above the market,price at market levels,or price below the market?

The maintained markup percentage equals the retailer's initial markup percentage minus its reduction percentage multiplied by 100 percent minus its initial markup percentage.

As a rule,if a retailer wants to attract customers from a greater it must_____ its merchandise.

A one-price policy speeds the amount of time needed to complete a customer transaction.

The practice of advertising a low-priced model of a shopping good to lure shoppers into a store is called a bait-and-switch pricing.

Mike's Appliances bought a refrigerator for $480.The initial price on the refrigerator was $950,but it was ultimately sold for $825.What were initial and maintained markups,respectively?

A _____ is a range of prices for a specific merchandise line that appeals to customers in a certain demographic group.

Retailers use multiple-unit pricing to encourage additional sales and to increase profits.

A _____ objective is a pricing objective that states a specific level of profit,such a as percentage of sales or a return on capital invested,as an objective.

A major advantage of the penetration objective is that it helps to establish a loyal customer base.

Flowers tend to be priced higher when demand is greatest,around Mother's Day and Valentine's Day.This is an example of _____ pricing.

Perspectives on Retailing

Retail Strategic Planning and Operations Management

Retail Customers

Evaluating the Competition in Retailing

Managing the Supply Chain

Legal and Ethical Behavior

Market Selection and Retail Location Analysis

Managing a Retailer’s Finances

Merchandise Buying and Handling

Advertising and Promotion

Customer Service and Retail Selling

Store Layout and Design

Managing People

Filters

Exam 10: Merchandise Pricing

Because odd prices are associated with low prices,they are typically used by retailers who sell at prices below the market or at the market.

The practice of advertising a low-priced model of a shopping good which the retailer has no intention of selling,in order to lure shoppers into a store is called "trading up."

Your local bike shop offers a wide variety of bicycles at the following price levels: $99.99,$160.99,$320.95,$619.99,and $1039.99.The bike shop is using a _____ pricing strategy.

Pricing policies are rules of action,or guidelines,that ensure uniformity of pricing decisions within a retail operation.

For leader pricing to be effective,which of the following guidelines should be followed?

Retailers that wish to have greater pricing freedom are likely to carry private brands because consumers find it difficult to make exact comparisons between private brands and national brands.

A(n)_____ pricing policy is a policy that regularly discounts merchandise from the established market price in order to build store traffic,generate high sales,and enhance gross margin dollars per square foot of selling space.

Markdowns are always the result of buyer errors.

Which of the following situations is NOT a good reason for using a high markup percentage?

What factors should a retailer consider when deciding whether to price above the market,price at market levels,or price below the market?

The maintained markup percentage equals the retailer's initial markup percentage minus its reduction percentage multiplied by 100 percent minus its initial markup percentage.

As a rule,if a retailer wants to attract customers from a greater it must_____ its merchandise.

A one-price policy speeds the amount of time needed to complete a customer transaction.

The practice of advertising a low-priced model of a shopping good to lure shoppers into a store is called a bait-and-switch pricing.

Mike's Appliances bought a refrigerator for $480.The initial price on the refrigerator was $950,but it was ultimately sold for $825.What were initial and maintained markups,respectively?

A _____ is a range of prices for a specific merchandise line that appeals to customers in a certain demographic group.

Retailers use multiple-unit pricing to encourage additional sales and to increase profits.

A _____ objective is a pricing objective that states a specific level of profit,such a as percentage of sales or a return on capital invested,as an objective.

A major advantage of the penetration objective is that it helps to establish a loyal customer base.

Flowers tend to be priced higher when demand is greatest,around Mother's Day and Valentine's Day.This is an example of _____ pricing.

Perspectives on Retailing

Retail Strategic Planning and Operations Management

Retail Customers

Evaluating the Competition in Retailing

Managing the Supply Chain

Legal and Ethical Behavior

Market Selection and Retail Location Analysis

Managing a Retailer’s Finances

Merchandise Buying and Handling

Advertising and Promotion

Customer Service and Retail Selling

Store Layout and Design

Managing People

Filters