Question 1

Supermarket managers use standard markup pricing because it is particularly suited to situations when

Accepted Answer

A)  there is a large number of products and estimating the demand for each would be difficult and time consuming. 
B)  there is a large number of product lines, all with basically the same product attributes. 
C)  there is a specific profit goal that needs to be achieved. 
D)  there is a policy of selling every item in a product line at the same price regardless of the product class. 
E)  the products are perishable or seasonal. 
A)  there is a large number of products and estimating the demand for each would be difficult and time consuming. 
B)  there is a large number of product lines, all with basically the same product attributes. 
C)  there is a specific profit goal that needs to be achieved. 
D)  there is a policy of selling every item in a product line at the same price regardless of the product class. 
E)  the products are perishable or seasonal.

Question 2

Figure 14-1
-Figure 14-1 above represents the six steps in the price-setting process.Which letter represents the step where a firm would balance incremental costs and revenues?

Accepted Answer

A)  "E" 
B)  "F" 
C)  "D" 
D)  "C" 
E)  "A" 
A)  "E" 
B)  "F" 
C)  "D" 
D)  "C" 
E)  "A"

Question 3

Reductions in unit costs for a larger order are referred to as

Accepted Answer

A)  promotional allowances. 
B)  quantity discounts. 
C)  economic order discounts. 
D)  penetration pricing. 
E)  case allowances. 
A)  promotional allowances. 
B)  quantity discounts. 
C)  economic order discounts. 
D)  penetration pricing. 
E)  case allowances.

Question 4

Marginal analysis refers to

Accepted Answer

A)  a continuing, concise trade-off of incremental costs against incremental revenues. 
B)  the change in total cost that results from producing and marketing one additional unit of a product. 
C)  a technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output. 
D)  a continuing concise trade-off of incremental ROI and incremental ROA. 
E)  a technique that analyzes the relationship between revenues, profit, and market share relative to changes in market growth rates. 
A)  a continuing, concise trade-off of incremental costs against incremental revenues. 
B)  the change in total cost that results from producing and marketing one additional unit of a product. 
C)  a technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output. 
D)  a continuing concise trade-off of incremental ROI and incremental ROA. 
E)  a technique that analyzes the relationship between revenues, profit, and market share relative to changes in market growth rates.

Question 5

a __________ pricing strategy,a price setter stresses the __________ side of the pricing problem.

Accepted Answer

A)  demand-oriented; cost 
B)  supply-oriented; target ROI 
C)  competition-oriented; marketing channel 
D)  cost-oriented; cost 
E)  profit-oriented; revenue 
A)  demand-oriented; cost 
B)  supply-oriented; target ROI 
C)  competition-oriented; marketing channel 
D)  cost-oriented; cost 
E)  profit-oriented; revenue

Question 6

Geographical Pricing Map B
-pricing strategy where the buyer is allowed to deduct freight expenses from the list price of the goods so the seller pays the transportation costs is referred to as

Accepted Answer

A)  FOB factory pricing. 
B)  FOB absorption pricing. 
C)  FOB origin pricing. 
D)  basing-point pricing. 
E)  FOB with freight-allowed pricing. 
A)  FOB factory pricing. 
B)  FOB absorption pricing. 
C)  FOB origin pricing. 
D)  basing-point pricing. 
E)  FOB with freight-allowed pricing.

Question 7

Hallmark was the official supplier of flowers at the last Winter Olympics.Hallmark presented each Olympic winner with a special bouquet of roses designed to resemble the Olympic torch.Consumers were able to buy a smaller version of this same bouquet at the Hallmark website for $74.95.The Olympic bouquet that consumers could buy contained two dozen yellow roses,yet you could buy the same two dozen yellow roses for less than $35 at most supermarkets.If Hallmark is treating the Olympic bouquet as an innovative product,then it is using which demand-oriented pricing approach?

Accepted Answer

A)  bundle pricing 
B)  yield management pricing 
C)  skimming pricing 
D)  target return-on-sales pricing 
E)  penetration pricing 
A)  bundle pricing 
B)  yield management pricing 
C)  skimming pricing 
D)  target return-on-sales pricing 
E)  penetration pricing

Question 8

pricing method where all buyers pay the same delivered price for the products,regardless of their distance from the seller,is referred to as __________.

Accepted Answer

A)  single-zone pricing 
B)  multiple-zone pricing 
C)  freight-absorption pricing 
D)  FOB origin pricing 
E)  basing-point pricing 
A)  single-zone pricing 
B)  multiple-zone pricing 
C)  freight-absorption pricing 
D)  FOB origin pricing 
E)  basing-point pricing

Question 9

Skimming pricing is considered to be a __________ approach to pricing.

Accepted Answer

A)  demand-oriented 
B)  cost-oriented 
C)  profit-oriented 
D)  competition-oriented 
E)  service-oriented 
A)  demand-oriented 
B)  cost-oriented 
C)  profit-oriented 
D)  competition-oriented 
E)  service-oriented

Question 10

Geographical Pricing Map A
-After extensive analysis,a mail order company has decided to embark on a policy of multiple-zone pricing.In which step of the price-setting process would the mail order firm have made this decision?

Accepted Answer

A)  make special adjustments to the list or quoted price 
B)  select an approximate price level 
C)  estimate demand and revenue 
D)  identify price constraints and objectives 
E)  set list or quoted price 
A)  make special adjustments to the list or quoted price 
B)  select an approximate price level 
C)  estimate demand and revenue 
D)  identify price constraints and objectives 
E)  set list or quoted price

Question 11

Family Dollar Stores Photo
-Consider the photo above.Family Dollar Stores,like 99¢ Stores,use what type of pricing policy?

Accepted Answer

A)  target 
B)  customary 
C)  flexible 
D)  one 
E)  below-market 
A)  target 
B)  customary 
C)  flexible 
D)  one 
E)  below-market

Question 12

ad campaign by Suave shampoo asked television viewers to identify the heads of hair of women who used Suave shampoo and conditioner and those that used the much more expensive salon hair-care products.The idea of the ad was that no one could tell which woman used the much cheaper Suave brand.By making price its selling point,Suave is most likely using __________.

Accepted Answer

A)  above-market pricing 
B)  loss-leader pricing 
C)  prestige pricing 
D)  skimming pricing 
E)  below-market pricing 
A)  above-market pricing 
B)  loss-leader pricing 
C)  prestige pricing 
D)  skimming pricing 
E)  below-market pricing

Question 13

setting of prices for all items in a product line to cover the total cost and produce a profit for the complete line,not necessarily for each item,is referred to as

Accepted Answer

A)  line item pricing. 
B)  product-line pricing. 
C)  price lining. 
D)  customary pricing. 
E)  discretionary pricing. 
A)  line item pricing. 
B)  product-line pricing. 
C)  price lining. 
D)  customary pricing. 
E)  discretionary pricing.

Question 14

Which of the following statements regarding price lining is most accurate?

Accepted Answer

A)  In order for price lining to be effective, there should be at least 10 specified price points. 
B)  Price lining assumes that demand is inelastic at each price point but elastic between price points. 
C)  Price lining assumes that demand is elastic at each price point but inelastic between price points. 
D)  Price lining is the preferred pricing strategy for governmental contracts. 
E)  Price lining is the same as above-, at-, or below-market pricing. 
A)  In order for price lining to be effective, there should be at least 10 specified price points. 
B)  Price lining assumes that demand is inelastic at each price point but elastic between price points. 
C)  Price lining assumes that demand is elastic at each price point but inelastic between price points. 
D)  Price lining is the preferred pricing strategy for governmental contracts. 
E)  Price lining is the same as above-, at-, or below-market pricing.

Question 15

3M launched its premium Greptile Grip golf glove consisting of the highest quality Cabretta sheep leather,it suggested a retail price range of $16.95 to $19.95.Golf glove marketer Bionic had introduced its Classic at $24.95 and its Pro at $39.95,while FootJoy launched its Pure Touch Limited at $28.00 and its SciFlex at $18.00.Other competitors focused on price/value at three price points: $6.00-$9.99,$10.00-$16.99,and $17.00 and up.These statements suggest that 3M has been pursuing a __________ method of selecting an approximate price level.

Accepted Answer

A)  competition-based 
B)  profit-oriented 
C)  cost-oriented 
D)  demand-oriented 
E)  experience-oriented 
A)  competition-based 
B)  profit-oriented 
C)  cost-oriented 
D)  demand-oriented 
E)  experience-oriented

Question 16

unique feature of the Robinson-Patman Act is that it allows for price differentials to different customers under several conditions.Which of the following practices would be permitted?

Accepted Answer

A)  Using price differentials when price differences are given on the basis of other family businesses. 
B)  Using price differentials when charging different prices to different buyers for goods of like grade or quality. 
C)  When price differences are quoted to selected buyers in good faith to meet competitors' prices and are not intended to injure competition. 
D)  Using price differentials when charging different prices on the basis of religious affiliation. 
E)  Using price differentials when charging the original price for refurbished goods that have been damaged or used and returned but repaired according to company specifications. 
A)  Using price differentials when price differences are given on the basis of other family businesses. 
B)  Using price differentials when charging different prices to different buyers for goods of like grade or quality. 
C)  When price differences are quoted to selected buyers in good faith to meet competitors' prices and are not intended to injure competition. 
D)  Using price differentials when charging different prices on the basis of religious affiliation. 
E)  Using price differentials when charging the original price for refurbished goods that have been damaged or used and returned but repaired according to company specifications.

Question 17

movement from point A to point B in Figure 14-3A above shows

Accepted Answer

A)  skimming demand. 
B)  penetration demand. 
C)  that buyers see the product as a bargain and buy more. 
D)  that buyers become dubious about the quality and prestige and buy less. 
E)  a downturn in the economy. 
A)  skimming demand. 
B)  penetration demand. 
C)  that buyers see the product as a bargain and buy more. 
D)  that buyers become dubious about the quality and prestige and buy less. 
E)  a downturn in the economy.

Question 18

Which of the following is a cost-oriented pricing method?

Accepted Answer

A)  loss leader pricing 
B)  standard markup pricing 
C)  at-, above-, or below-market pricing 
D)  price lining 
E)  penetration pricing 
A)  loss leader pricing 
B)  standard markup pricing 
C)  at-, above-, or below-market pricing 
D)  price lining 
E)  penetration pricing

Question 19

the cash discount terms for a $500 purchase are 4/10 net 30,the number $500 refers to

Accepted Answer

A)  the original price owed on the merchandise. 
B)  the total amount owed if paid within 10 days. 
C)  the total discount in dollars if the bill is paid on time in 30 days. 
D)  the manufacturer's suggested wholesale price. 
E)  the total penalty in dollars if the bill is paid after 10 days. 
A)  the original price owed on the merchandise. 
B)  the total amount owed if paid within 10 days. 
C)  the total discount in dollars if the bill is paid on time in 30 days. 
D)  the manufacturer's suggested wholesale price. 
E)  the total penalty in dollars if the bill is paid after 10 days.

Question 20

Figure 14-1
-According to Figure 14-1 above,"E" represents which step in the price-setting process?

Accepted Answer

A)  set list or quoted price 
B)  select an approximate price level 
C)  scan competitors for prices of similar products or services 
D)  determine cost, volume, and profit relationships 
E)  identify pricing objectives and constraints 
A)  set list or quoted price 
B)  select an approximate price level 
C)  scan competitors for prices of similar products or services 
D)  determine cost, volume, and profit relationships 
E)  identify pricing objectives and constraints

Supermarket managers use standard markup pricing because it is particularly suited to situations when

Figure 14-1 -Figure 14-1 above represents the six steps in the price-setting process.Which letter represents the step where a firm would balance incremental costs and revenues?

Reductions in unit costs for a larger order are referred to as

Marginal analysis refers to

a pricing strategy,a price setter stresses the side of the pricing problem.

Geographical Pricing Map B -pricing strategy where the buyer is allowed to deduct freight expenses from the list price of the goods so the seller pays the transportation costs is referred to as

pricing method where all buyers pay the same delivered price for the products,regardless of their distance from the seller,is referred to as __________.

Skimming pricing is considered to be a __________ approach to pricing.

Geographical Pricing Map A -After extensive analysis,a mail order company has decided to embark on a policy of multiple-zone pricing.In which step of the price-setting process would the mail order firm have made this decision?

Family Dollar Stores Photo -Consider the photo above.Family Dollar Stores,like 99¢ Stores,use what type of pricing policy?

setting of prices for all items in a product line to cover the total cost and produce a profit for the complete line,not necessarily for each item,is referred to as

Which of the following statements regarding price lining is most accurate?

unique feature of the Robinson-Patman Act is that it allows for price differentials to different customers under several conditions.Which of the following practices would be permitted?

movement from point A to point B in Figure 14-3A above shows

Which of the following is a cost-oriented pricing method?

the cash discount terms for a $500 purchase are 4/10 net 30,the number $500 refers to

Figure 14-1 -According to Figure 14-1 above,"E" represents which step in the price-setting process?

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Scanning the Marketing Environment

Ethical and Social Responsibility for Sustainable Marketing

Understanding Consumer Behavior

Understanding Organizations As Customers

Understanding and Reaching Global Consumers and Markets

Marketing Research: From Customer Insights to Actions

Market Segmentation,Targeting,and Positioning

Developing New Products and Services

Managing Successful Products,Services,and Brands

Services Marketing

Building the Price Foundation

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Using Social Media and Mobile Marketing to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multi-Channel Marketing

Pulling It All Together: The Strategic Marketing Process

Filters

Exam 14: Arriving at the Final Price

Supermarket managers use standard markup pricing because it is particularly suited to situations when

Figure 14-1 -Figure 14-1 above represents the six steps in the price-setting process.Which letter represents the step where a firm would balance incremental costs and revenues?

Reductions in unit costs for a larger order are referred to as

Marginal analysis refers to

a __________ pricing strategy,a price setter stresses the __________ side of the pricing problem.

Geographical Pricing Map B -pricing strategy where the buyer is allowed to deduct freight expenses from the list price of the goods so the seller pays the transportation costs is referred to as

pricing method where all buyers pay the same delivered price for the products,regardless of their distance from the seller,is referred to as __________.

Skimming pricing is considered to be a __________ approach to pricing.

Geographical Pricing Map A -After extensive analysis,a mail order company has decided to embark on a policy of multiple-zone pricing.In which step of the price-setting process would the mail order firm have made this decision?

Family Dollar Stores Photo -Consider the photo above.Family Dollar Stores,like 99¢ Stores,use what type of pricing policy?

setting of prices for all items in a product line to cover the total cost and produce a profit for the complete line,not necessarily for each item,is referred to as

Which of the following statements regarding price lining is most accurate?

unique feature of the Robinson-Patman Act is that it allows for price differentials to different customers under several conditions.Which of the following practices would be permitted?

movement from point A to point B in Figure 14-3A above shows

Which of the following is a cost-oriented pricing method?

the cash discount terms for a $500 purchase are 4/10 net 30,the number $500 refers to

Figure 14-1 -According to Figure 14-1 above,"E" represents which step in the price-setting process?

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Scanning the Marketing Environment

Ethical and Social Responsibility for Sustainable Marketing

Understanding Consumer Behavior

Understanding Organizations As Customers

Understanding and Reaching Global Consumers and Markets

Marketing Research: From Customer Insights to Actions

Market Segmentation,Targeting,and Positioning

Developing New Products and Services

Managing Successful Products,Services,and Brands

Services Marketing

Building the Price Foundation

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Using Social Media and Mobile Marketing to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multi-Channel Marketing

Pulling It All Together: The Strategic Marketing Process

Filters

a pricing strategy,a price setter stresses the side of the pricing problem.