Question 1

What is market-plus pricing? Why do companies practice a skimming strategy?

Accepted Answer

Market-plus pricing is the practice of i

Question 2

Every online marketer is inherently a global marketer who must understand the internal and external conditions that affect global pricing strategies.

Accepted Answer

A) True 
 B)False

Question 3

Increased competition in the marketplace forces an innovative company to bring down the price of a product even lower than its eventual level under a nonsequential skimming procedure.

Accepted Answer

A) True 
 B)False

Question 4

Transfer pricing becomes especially complex when the global market is involved because:

Accepted Answer

A)  shipping materials across national lines involves payment of duties and taxes, and these become part of the total price of the goods. 
B)  issues of quality control can be serious, even when divisions of the same firm are involved. 
C)  a firm with activities in several countries can use transfer pricing as a tax-avoidance device and governments frown upon such activities. 
D)  the temperature and humidity differences between origins and destinations often damage the products. 
A)  shipping materials across national lines involves payment of duties and taxes, and these become part of the total price of the goods. 
B)  issues of quality control can be serious, even when divisions of the same firm are involved. 
C)  a firm with activities in several countries can use transfer pricing as a tax-avoidance device and governments frown upon such activities. 
D)  the temperature and humidity differences between origins and destinations often damage the products.

Question 5

When a men's clothing store sells suits at four price levels ($295,$455,$525,$650),the store's retail policy is _____ pricing.

Accepted Answer

A)  unit 
B)  promotional 
C)  product-line 
D)  psychological 
A)  unit 
B)  promotional 
C)  product-line 
D)  psychological

Question 6

Retailers such as Walmart achieve everyday low pricing by negotiating better prices from suppliers and by cutting its own costs.

Accepted Answer

A) True 
 B)False

Question 7

A(n)_____ is a pricing practice in which a firm raises prices and then wait to see if others follow suit.

Accepted Answer

A) competitive bidding 
B) penetration pricing strategy 
C) list price 
D) trade discount 
E) price flexibility
F)promotional pricing
G)loss leader
H)cannibalization
I)bundle pricing
J)odd pricing
K)transfer price
L)profit center
M)skimming pricing strategy
N)competitive pricing strategy
O)pricing policy
P)market price
Q)noncumulative quantity discount
R)step out
S)bot
T)cash discount 
A) competitive bidding 
B) penetration pricing strategy 
C) list price 
D) trade discount 
E) price flexibility
F)promotional pricing
G)loss leader
H)cannibalization
I)bundle pricing
J)odd pricing
K)transfer price
L)profit center
M)skimming pricing strategy
N)competitive pricing strategy
O)pricing policy
P)market price
Q)noncumulative quantity discount
R)step out
S)bot
T)cash discount

Question 8

Retailers such as Home Depot and Lowe's,who offer to meet and beat the best price offered by their competitors,use the strategy of _____ pricing.

Accepted Answer

A)  skimming 
B)  penetration 
C)  competitive 
D)  cost-plus 
A)  skimming 
B)  penetration 
C)  competitive 
D)  cost-plus

Question 9

Differentiate between the list price and market price of a product.

Accepted Answer

The list price of a product is the rate

Question 10

Which of the following pricing policies is more likely to be applied in marketing programs based on individual bargaining?

Accepted Answer

A)  Product-line pricing 
B)  Promotional pricing 
C)  Price flexibility 
D)  Odd pricing 
A)  Product-line pricing 
B)  Promotional pricing 
C)  Price flexibility 
D)  Odd pricing

Question 11

A penetration pricing strategy is called _____ pricing when it implements the premise that a lower-than-market price will attract buyers and move a brand from an unknown newcomer to brand-recognition or brand-preference stage.

Accepted Answer

A)  market-plus 
B)  market-minus 
C)  EDLP 
D)  FOB 
A)  market-plus 
B)  market-minus 
C)  EDLP 
D)  FOB

Question 12

Which of the following pricing systems is sometimes referred to as postage-stamp pricing since it resembles the pricing structure for mail service?

Accepted Answer

A)  Zone pricing 
B)  Freight absorption pricing 
C)  Uniform-delivered pricing 
D)  The basing-point system 
A)  Zone pricing 
B)  Freight absorption pricing 
C)  Uniform-delivered pricing 
D)  The basing-point system

Question 13

A standard worldwide pricing policy is more likely to succeed in foreign markets with high marketing costs.

Accepted Answer

A) True 
 B)False

Question 14

A skimming pricing strategy is ineffective in marketing higher-end goods.

Accepted Answer

A) True 
 B)False

Question 15

A(n)_____ is a software program that allows online shoppers to compare prices of a particular product offered by several online retailers.

Accepted Answer

A) competitive bidding 
B) penetration pricing strategy 
C) list price 
D) trade discount 
E) price flexibility
F)promotional pricing
G)loss leader
H)cannibalization
I)bundle pricing
J)odd pricing
K)transfer price
L)profit center
M)skimming pricing strategy
N)competitive pricing strategy
O)pricing policy
P)market price
Q)noncumulative quantity discount
R)step out
S)bot
T)cash discount 
A) competitive bidding 
B) penetration pricing strategy 
C) list price 
D) trade discount 
E) price flexibility
F)promotional pricing
G)loss leader
H)cannibalization
I)bundle pricing
J)odd pricing
K)transfer price
L)profit center
M)skimming pricing strategy
N)competitive pricing strategy
O)pricing policy
P)market price
Q)noncumulative quantity discount
R)step out
S)bot
T)cash discount

Question 16

The demand for private-label goods will be low in a tough economy.

Accepted Answer

A) True 
 B)False

Question 17

When a manufacturer quotes the same price for goods (including freight charges)to a buyer in Miami,another in Los Angeles,and a third in Dallas,the seller is quoting a _____ price.

Accepted Answer

A)  uniform-delivered 
B)  destination 
C)  zone 
D)  basing-point 
A)  uniform-delivered 
B)  destination 
C)  zone 
D)  basing-point

Question 18

In an attempt to simplify pricing structures,sellers will quote uniform prices that,in effect,spread the total shipping costs across all the customers.

Accepted Answer

A) True 
 B)False

Question 19

A _____ pricing strategy makes more flexible arrangements,compared to other strategies,to set prices according to local marketplace conditions.

Accepted Answer

A)  standard 
B)  product-line 
C)  market-differentiated 
D)  dual 
A)  standard 
B)  product-line 
C)  market-differentiated 
D)  dual

Question 20

In an FOB pricing policy,the seller pays all freight charges to transport the product from the manufacturer's loading dock.

Accepted Answer

A) True 
 B)False

Exam 19: Pricing Strategies

What is market-plus pricing? Why do companies practice a skimming strategy?

Every online marketer is inherently a global marketer who must understand the internal and external conditions that affect global pricing strategies.

Increased competition in the marketplace forces an innovative company to bring down the price of a product even lower than its eventual level under a nonsequential skimming procedure.

Transfer pricing becomes especially complex when the global market is involved because:

When a men's clothing store sells suits at four price levels ($295,$455,$525,$650),the store's retail policy is _____ pricing.

Retailers such as Walmart achieve everyday low pricing by negotiating better prices from suppliers and by cutting its own costs.

A(n)_____ is a pricing practice in which a firm raises prices and then wait to see if others follow suit.

Retailers such as Home Depot and Lowe's,who offer to meet and beat the best price offered by their competitors,use the strategy of _____ pricing.

Differentiate between the list price and market price of a product.

Which of the following pricing policies is more likely to be applied in marketing programs based on individual bargaining?

A penetration pricing strategy is called _____ pricing when it implements the premise that a lower-than-market price will attract buyers and move a brand from an unknown newcomer to brand-recognition or brand-preference stage.

Which of the following pricing systems is sometimes referred to as postage-stamp pricing since it resembles the pricing structure for mail service?

A standard worldwide pricing policy is more likely to succeed in foreign markets with high marketing costs.

A skimming pricing strategy is ineffective in marketing higher-end goods.

A(n)_____ is a software program that allows online shoppers to compare prices of a particular product offered by several online retailers.

The demand for private-label goods will be low in a tough economy.

When a manufacturer quotes the same price for goods (including freight charges)to a buyer in Miami,another in Los Angeles,and a third in Dallas,the seller is quoting a _____ price.

In an attempt to simplify pricing structures,sellers will quote uniform prices that,in effect,spread the total shipping costs across all the customers.

A _____ pricing strategy makes more flexible arrangements,compared to other strategies,to set prices according to local marketplace conditions.

In an FOB pricing policy,the seller pays all freight charges to transport the product from the manufacturer's loading dock.

Marketing: The Art and Science of Satisfying Customers

Strategic Planning in Contemporary Marketing

The Marketing Environment, Ethics, and Social Responsibility

Social Media: Living in the Connected World

E-Business: Managing the Customer Experience

Consumer Behavior

Business-to-Business (B2B)Marketing

Global Marketing

Market Segmentation, Targeting, and Positioning

Marketing Research and Sales Forecasting

Relationship Marketing and Customer Relationship Management (CRM)

Product and Service Strategies

Developing and Managing Brand and Product Categories

Marketing Channels and Supply Chain Management

Retailers, Wholesalers, and Direct Marketers

Integrated Marketing Communications, Advertising, and Public Relations

Personal Selling and Sales Promotion

Pricing Concepts

Your Career in Marketing

Developing an Effective Marketing Plan

Financial Analysis in Marketing

Filters