Question 1

The cost curve precisely depicts the variation in the quantity demanded at different prices.

Accepted Answer

A) True 
 B)False

Question 2

Target-return pricing adds one critical element to the pricing equation over mark-up pricing.Which is this additional cost element?

Accepted Answer

A) The price sensitivity of demand 
B) An evaluation of competitors' prices 
C) The other products in the product line 
D) The cost of invested capital 
A) The price sensitivity of demand 
B) An evaluation of competitors' prices 
C) The other products in the product line 
D) The cost of invested capital

Question 3

A premium price policy is most appropriate for businesses pursuing differentiated defender strategies.

Accepted Answer

A) True 
 B)False

Question 4

How is unit cost calculated?

Accepted Answer

Unit Cost = Variable

Question 5

The skimming pricing strategy is most often used by not-for-profit organizations

Accepted Answer

A) True 
 B)False

Question 6

A firm has unit costs of $10 per unit.The investment in capital for the production of the product is $2 million,expected unit sales are 100,000 units,and a desired rate of return on their investment is15%.Calculate the return price.

Accepted Answer

A) $13 
B) $15 
C) $17 
D) $21 
A) $13 
B) $15 
C) $17 
D) $21

Question 7

In the FOB pricing method:

Accepted Answer

A) the manufacturer pays all freight charges. 
B) a standard freight charge is charged to all customers irrespective of location. 
C) the company and the customer split the freight charges equally. 
D) the customer pays all the freight charges. 
A) the manufacturer pays all freight charges. 
B) a standard freight charge is charged to all customers irrespective of location. 
C) the company and the customer split the freight charges equally. 
D) the customer pays all the freight charges.

Question 8

James has invested in a health insurance plan that pays for half of his medical expenses.He is not very price-sensitive and does not hesitate to opt for expensive medial treatments.This is an example of the _____ effect.

Accepted Answer

A) unique-value 
B) shared-cost 
C) difficult-comparison 
D) inventory 
A) unique-value 
B) shared-cost 
C) difficult-comparison 
D) inventory

Question 9

The demand curve depicts the relationship between:

Accepted Answer

A) profitability and demand. 
B) product costs and price. 
C) price and profitability. 
D) price and demanD. 
A) profitability and demand. 
B) product costs and price. 
C) price and profitability. 
D) price and demanD.

Question 10

What is price lining? Explain with the help of an example.

Accepted Answer

Price lining is a customer-oriented pric

Question 11

Variable costs remain constant per unit regardless of how many units are produced.

Accepted Answer

A) True 
 B)False

Question 12

In addition to price discrimination,the Sherman Act prohibits both horizontal and vertical price fixing.

Accepted Answer

A) True 
 B)False

Question 13

A cross-elasticity is the percentage change in sales of one product induced by a 1 percent change in the price of another complementary product.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following best describes the sunk-investment effect on price sensitivity?

Accepted Answer

A) Customers are less price-sensitive when there are no acceptable substitutes for a product. 
B) Customers are less price-sensitive when the purchase is necessary to gain full benefit from assets previously bought. 
C) Customers are less price-sensitive when their expenditure for the product or service is a relatively low proportion of their total income. 
D) Customers are less price-sensitive in the short run when they cannot store large quantities of the product as a hedge against future price increases. 
A) Customers are less price-sensitive when there are no acceptable substitutes for a product. 
B) Customers are less price-sensitive when the purchase is necessary to gain full benefit from assets previously bought. 
C) Customers are less price-sensitive when their expenditure for the product or service is a relatively low proportion of their total income. 
D) Customers are less price-sensitive in the short run when they cannot store large quantities of the product as a hedge against future price increases.

Question 15

Prices set solely on the basis of competitive considerations always reflect customer value.

Accepted Answer

A) True 
 B)False

Question 16

Zone pricing is a compromise approach that falls between FOB and uniform delivered pricing.

Accepted Answer

A) True 
 B)False

Question 17

Explain the following terms: fixed costs (overhead),variable costs,and total costs.

Accepted Answer

Fixed costs (or overhead)are constant in

Question 18

Gloria,a company dealing in toiletries,sells its Big Saver shaving kits at a price less than the total price of the items,if priced separately.This is an example of _____.

Accepted Answer

A) differential pricing 
B) cross-elasticity 
C) price lining 
D) product bundling 
A) differential pricing 
B) cross-elasticity 
C) price lining 
D) product bundling

Question 19

Skimming is not appropriate for businesses pursuing prospector strategies involving investments in the development of a stream of new products.

Accepted Answer

A) True 
 B)False

Question 20

The break-even volume for a product is 10,000 units,the fixed cost is $10,000,and variable cost is $1 per unit.What is the required selling price per unit?

Accepted Answer

A) $2.00 
B) $1.50 
C) $1.00 
D) $.50 
A) $2.00 
B) $1.50 
C) $1.00 
D) $.50

The cost curve precisely depicts the variation in the quantity demanded at different prices.

Target-return pricing adds one critical element to the pricing equation over mark-up pricing.Which is this additional cost element?

A premium price policy is most appropriate for businesses pursuing differentiated defender strategies.

How is unit cost calculated?

The skimming pricing strategy is most often used by not-for-profit organizations

A firm has unit costs of $10 per unit.The investment in capital for the production of the product is $2 million,expected unit sales are 100,000 units,and a desired rate of return on their investment is15%.Calculate the return price.

In the FOB pricing method:

James has invested in a health insurance plan that pays for half of his medical expenses.He is not very price-sensitive and does not hesitate to opt for expensive medial treatments.This is an example of the _____ effect.

The demand curve depicts the relationship between:

What is price lining? Explain with the help of an example.

Variable costs remain constant per unit regardless of how many units are produced.

In addition to price discrimination,the Sherman Act prohibits both horizontal and vertical price fixing.

A cross-elasticity is the percentage change in sales of one product induced by a 1 percent change in the price of another complementary product.

Which of the following best describes the sunk-investment effect on price sensitivity?

Prices set solely on the basis of competitive considerations always reflect customer value.

Zone pricing is a compromise approach that falls between FOB and uniform delivered pricing.

Explain the following terms: fixed costs (overhead),variable costs,and total costs.

Gloria,a company dealing in toiletries,sells its Big Saver shaving kits at a price less than the total price of the items,if priced separately.This is an example of _____.

Skimming is not appropriate for businesses pursuing prospector strategies involving investments in the development of a stream of new products.

The break-even volume for a product is 10,000 units,the fixed cost is $10,000,and variable cost is $1 per unit.What is the required selling price per unit?

The Marketing Management Process

The Marketing Implications of Corporate and Business Strategies

Understanding Market Opportunities

Understanding Consumer Buying Behavior

Understanding Organizational Markets and Buying Behavior

Measuring Market Opportunities: Forecasting and Market Knowledge

Targeting Attractive Market Segments

Differentiation and Brand Positioning

Business Strategies: a Foundation for Marketing Program Decisions

Product Decisions

Distribution Channel Decisions

Integrated Promotion Decisions

Marketing Strategies for a Digitally Networked World

Strategies for New and Growing Markets

Strategies for Mature and Declining Markets

Organizing and Planning for Effective Implementation

Measuring and Delivering Marketing Performance

Filters

Exam 11: Pricing Decisions

The cost curve precisely depicts the variation in the quantity demanded at different prices.

Target-return pricing adds one critical element to the pricing equation over mark-up pricing.Which is this additional cost element?

A premium price policy is most appropriate for businesses pursuing differentiated defender strategies.

How is unit cost calculated?

The skimming pricing strategy is most often used by not-for-profit organizations

A firm has unit costs of $10 per unit.The investment in capital for the production of the product is $2 million,expected unit sales are 100,000 units,and a desired rate of return on their investment is15%.Calculate the return price.

In the FOB pricing method:

James has invested in a health insurance plan that pays for half of his medical expenses.He is not very price-sensitive and does not hesitate to opt for expensive medial treatments.This is an example of the _____ effect.

The demand curve depicts the relationship between:

What is price lining? Explain with the help of an example.

Variable costs remain constant per unit regardless of how many units are produced.

In addition to price discrimination,the Sherman Act prohibits both horizontal and vertical price fixing.

A cross-elasticity is the percentage change in sales of one product induced by a 1 percent change in the price of another complementary product.

Which of the following best describes the sunk-investment effect on price sensitivity?

Prices set solely on the basis of competitive considerations always reflect customer value.

Zone pricing is a compromise approach that falls between FOB and uniform delivered pricing.

Explain the following terms: fixed costs (overhead),variable costs,and total costs.

Gloria,a company dealing in toiletries,sells its Big Saver shaving kits at a price less than the total price of the items,if priced separately.This is an example of _____.

Skimming is not appropriate for businesses pursuing prospector strategies involving investments in the development of a stream of new products.

The break-even volume for a product is 10,000 units,the fixed cost is $10,000,and variable cost is $1 per unit.What is the required selling price per unit?

The Marketing Management Process

The Marketing Implications of Corporate and Business Strategies

Understanding Market Opportunities

Understanding Consumer Buying Behavior

Understanding Organizational Markets and Buying Behavior

Measuring Market Opportunities: Forecasting and Market Knowledge

Targeting Attractive Market Segments

Differentiation and Brand Positioning

Business Strategies: a Foundation for Marketing Program Decisions

Product Decisions

Distribution Channel Decisions

Integrated Promotion Decisions

Marketing Strategies for a Digitally Networked World

Strategies for New and Growing Markets

Strategies for Mature and Declining Markets

Organizing and Planning for Effective Implementation

Measuring and Delivering Marketing Performance

Filters