Question 1

Which of the following is true of the full-cost pricing approach?

Accepted Answer

A)  In this approach, firms regard foreign sales as bonus sales and assume that there will be no return over their variable costs. 
B)  In this approach, firms are concerned only with the marginal or incremental cost of producing goods to be sold in overseas markets. 
C)  In this approach, prices are often set on a cost-plus basis, that is, total costs plus a profit margin. 
D)  This approach is a practical approach to pricing when a company has high fixed costs and unused production capacity. 
E)  This approach insists that each unit of a similar product is treated differently in terms of cost. 
A)  In this approach, firms regard foreign sales as bonus sales and assume that there will be no return over their variable costs. 
B)  In this approach, firms are concerned only with the marginal or incremental cost of producing goods to be sold in overseas markets. 
C)  In this approach, prices are often set on a cost-plus basis, that is, total costs plus a profit margin. 
D)  This approach is a practical approach to pricing when a company has high fixed costs and unused production capacity. 
E)  This approach insists that each unit of a similar product is treated differently in terms of cost. C

Question 2

Companies that are serious about restricting the gray market must establish and monitor controls that effectively police distribution channels.

Accepted Answer

A) True 
 B)False  True

Question 3

In a free trade zone, payment of import duties is postponed until the product leaves the free trade zone and enters the country.

Accepted Answer

A) True 
 B)False  True

Question 4

In _____, a firm is concerned only with the marginal or incremental cost of producing goods to be sold in overseas markets.

Accepted Answer

A)  full-cost pricing 
B)  full cost pricing 
C)  fixed-cost pricing 
D)  variable-cost pricing 
E)  demand-based pricing
F) premium pricing 
A)  full-cost pricing 
B)  full cost pricing 
C)  fixed-cost pricing 
D)  variable-cost pricing 
E)  demand-based pricing
F) premium pricing

Question 5

Write a brief note on parallel importing.

Accepted Answer

Parallel importing occurs when importers

Question 6

When a company exports a product from the United States to another country, the company is most likely to be unable to determine the ultimate price of a product if:

Accepted Answer

A)  the channels of distribution are short. 
B)  the number of middlemen in its distribution channels is low. 
C)  large orders are placed by retailers. 
D)  marketing and distribution channel infrastructures are well developed. 
E)  the middleman markups are not standardized. 
A)  the channels of distribution are short. 
B)  the number of middlemen in its distribution channels is low. 
C)  large orders are placed by retailers. 
D)  marketing and distribution channel infrastructures are well developed. 
E)  the middleman markups are not standardized.

Question 7

A(n) _____ means that once the seller has accepted the credit, the buyer cannot alter it in any way without permission of the seller.

Accepted Answer

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

Question 8

In most cases, the reason why products cost relatively little in one country and cost more in another is:

Accepted Answer

A)  the profiteering measures taken by exporting companies. 
B)  the consistency in perception of quality in all countries. 
C)  the inelastic demand of most consumer goods. 
D)  the requirement that all export goods must use set skimmed price. 
E)  the higher costs of exporting. 
A)  the profiteering measures taken by exporting companies. 
B)  the consistency in perception of quality in all countries. 
C)  the inelastic demand of most consumer goods. 
D)  the requirement that all export goods must use set skimmed price. 
E)  the higher costs of exporting.

Question 9

For countervailing duties to be invoked, it must be shown that prices are higher in the importing country than in the exporting country.

Accepted Answer

A) True 
 B)False

Question 10

What is a countertrade? What are the problems of countertrading?

Accepted Answer

Countertrade is a pricing tool that ever

Question 11

A _____ exists when various companies producing similar products or services work together to control markets for the types of goods and services they produce.

Accepted Answer

A)  cabal 
B)  monopoly 
C)  cartel 
D)  producers' association 
E)  competitive market 
A)  cabal 
B)  monopoly 
C)  cartel 
D)  producers' association 
E)  competitive market

Question 12

By shipping unassembled goods to a free trade zone (FTZ) in an importing country, a marketer can typically lower costs because:

Accepted Answer

A)  labor costs are higher in the importing country. 
B)  the final prices of the goods are adjusted for inflation. 
C)  use of unassembled goods gives the marketer immunity from dumping penalties. 
D)  duties are assessed at lower rates for unassembled goods. 
E)  local content used in production is low. 
A)  labor costs are higher in the importing country. 
B)  the final prices of the goods are adjusted for inflation. 
C)  use of unassembled goods gives the marketer immunity from dumping penalties. 
D)  duties are assessed at lower rates for unassembled goods. 
E)  local content used in production is low.

Question 13

A company that views pricing as a static element in a business decision most probably:

Accepted Answer

A)  places a high priority on foreign business. 
B)  sets prices to achieve specific objectives such as targeted return on profit. 
C)  views export sales as active contributions to sales volume. 
D)  views domestic sales as an insignificant source of revenue. 
E)  exports only excess inventory. 
A)  places a high priority on foreign business. 
B)  sets prices to achieve specific objectives such as targeted return on profit. 
C)  views export sales as active contributions to sales volume. 
D)  views domestic sales as an insignificant source of revenue. 
E)  exports only excess inventory.

Question 14

In a(n) _____, 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 transaction 
B)  factoring transaction 
C)  barter transaction 
D)  cash-in-advance payment 
E)  open account 
A)  forfaiting transaction 
B)  factoring transaction 
C)  barter transaction 
D)  cash-in-advance payment 
E)  open account

Question 15

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 16

What is the difference between forfaiting and factoring?

Accepted Answer

Forfaiting is similar to factoring, but

Question 17

With _____, the seller assumes all risk until the actual dollars are received.

Accepted Answer

A)  open accounts 
B)  irrevocable letters of credit 
C)  bills of exchange 
D)  factoring agreements 
E)  forfaiting contracts 
A)  open accounts 
B)  irrevocable letters of credit 
C)  bills of exchange 
D)  factoring agreements 
E)  forfaiting contracts

Question 18

Longer channels of distribution are more appropriate for keeping prices under control than shorter channels of distribution.

Accepted Answer

A) True 
 B)False

Question 19

Companies that use pricing to achieve marketing objectives use pricing as a static element.

Accepted Answer

A) True 
 B)False

Question 20

To remain price competitive when the U.S. dollar is strong, export-oriented companies must find ways to offset the higher price caused by currency values.

Accepted Answer

A) True 
 B)False

Which of the following is true of the full-cost pricing approach?

Companies that are serious about restricting the gray market must establish and monitor controls that effectively police distribution channels.

In a free trade zone, payment of import duties is postponed until the product leaves the free trade zone and enters the country.

In _____, a firm is concerned only with the marginal or incremental cost of producing goods to be sold in overseas markets.

Write a brief note on parallel importing.

When a company exports a product from the United States to another country, the company is most likely to be unable to determine the ultimate price of a product if:

A(n) _____ means that once the seller has accepted the credit, the buyer cannot alter it in any way without permission of the seller.

In most cases, the reason why products cost relatively little in one country and cost more in another is:

For countervailing duties to be invoked, it must be shown that prices are higher in the importing country than in the exporting country.

What is a countertrade? What are the problems of countertrading?

A _____ exists when various companies producing similar products or services work together to control markets for the types of goods and services they produce.

By shipping unassembled goods to a free trade zone (FTZ) in an importing country, a marketer can typically lower costs because:

A company that views pricing as a static element in a business decision most probably:

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

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

What is the difference between forfaiting and factoring?

With _____, the seller assumes all risk until the actual dollars are received.

Longer channels of distribution are more appropriate for keeping prices under control than shorter channels of distribution.

Companies that use pricing to achieve marketing objectives use pricing as a static element.

To remain price competitive when the U.S. dollar is strong, export-oriented companies must find ways to offset the higher price caused by currency values.

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

Which of the following is true of the full-cost pricing approach?

Companies that are serious about restricting the gray market must establish and monitor controls that effectively police distribution channels.

In a free trade zone, payment of import duties is postponed until the product leaves the free trade zone and enters the country.

In _____, a firm is concerned only with the marginal or incremental cost of producing goods to be sold in overseas markets.

Write a brief note on parallel importing.

When a company exports a product from the United States to another country, the company is most likely to be unable to determine the ultimate price of a product if:

A(n) _____ means that once the seller has accepted the credit, the buyer cannot alter it in any way without permission of the seller.

In most cases, the reason why products cost relatively little in one country and cost more in another is:

For countervailing duties to be invoked, it must be shown that prices are higher in the importing country than in the exporting country.

What is a countertrade? What are the problems of countertrading?

A _____ exists when various companies producing similar products or services work together to control markets for the types of goods and services they produce.

By shipping unassembled goods to a free trade zone (FTZ) in an importing country, a marketer can typically lower costs because:

A company that views pricing as a static element in a business decision most probably:

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

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

What is the difference between forfaiting and factoring?

With _____, the seller assumes all risk until the actual dollars are received.

Longer channels of distribution are more appropriate for keeping prices under control than shorter channels of distribution.

Companies that use pricing to achieve marketing objectives use pricing as a static element.

To remain price competitive when the U.S. dollar is strong, export-oriented companies must find ways to offset the higher price caused by currency values.

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