Question 1

Identify and describe the major types of discounts used for business markets.Then explain the reasons for using each type.

Accepted Answer

The answer of Identify and describe the major types of...

Question 2

The legality of uniform geographic pricing has been challenged,and so its use has been abandoned.

Accepted Answer

A) True 
 B)False

Question 3

A firm can survive in the long run only if its products are sold below cost.

Accepted Answer

A) True 
 B)False

Question 4

Marketers generally view ____ as the minimum price a product can be sold for.

Accepted Answer

A)  fixed costs 
B)  variable costs 
C)  profits 
D)  costs 
E)  moderate losses 
A)  fixed costs 
B)  variable costs 
C)  profits 
D)  costs 
E)  moderate losses

Question 5

Pricing whereby the buyer absorbs all or part of the freight costs is freight absorption pricing.

Accepted Answer

A) True 
 B)False

Question 6

A deduction from list price for purchasing large quantities aggregated over a stated period of time is a

Accepted Answer

A)  noncumulative quantity discount. 
B)  additive cash discount. 
C)  cumulative quantity discount. 
D)  cumulative discount allowance. 
E)  additive quantity reduction. 
A)  noncumulative quantity discount. 
B)  additive cash discount. 
C)  cumulative quantity discount. 
D)  cumulative discount allowance. 
E)  additive quantity reduction.

Question 7

Sellers using nonprice competition are not concerned with prices charged by competitors.

Accepted Answer

A) True 
 B)False

Question 8

A seller can change prices quickly in a price-competition situation.

Accepted Answer

A) True 
 B)False

Question 9

F.O.B.factory denotes the price of the products at the factory.If the price is quoted as F.O.B.shipping,then shipping costs are paid by the seller.

Accepted Answer

A) True 
 B)False

Question 10

The fact that a gas station in Texas pays less for fuel than a gas station in Maine from a producer in Louisiana suggests that refineries are using which of the following pricing methods?

Accepted Answer

A)  Price differentiation 
B)  Base-point pricing 
C)  Freight absorption pricing 
D)  Transfer pricing 
E)  Zone pricing 
A)  Price differentiation 
B)  Base-point pricing 
C)  Freight absorption pricing 
D)  Transfer pricing 
E)  Zone pricing

Question 11

Markum Industries determines that for its air compressors the following results are achieved at a price of $250: total costs = $250,000; variable costs per unit = $100; fixed costs = $175,000.Given these figures,Markum would break even at ____ units.

Accepted Answer

A)  1,167 
B)  1,000 
C)  1,750 
D)  2,500 
E)  700 
A)  1,167 
B)  1,000 
C)  1,750 
D)  2,500 
E)  700

Question 12

Nonprice competition allows a company to increase its brand's unit sales through means other than changing the brand's price.

Accepted Answer

A) True 
 B)False

Question 13

Total costs are influenced by quantities sold.

Accepted Answer

A) True 
 B)False

Question 14

A danger associated with engaging in price competition is that competitors can also change prices quickly and aggressively,which can result in a(n)____ that will be harmful to both companies.

Accepted Answer

A)  reduction in cost 
B)  price war 
C)  competitive draw 
D)  industry collapse 
E)  advertising battle 
A)  reduction in cost 
B)  price war 
C)  competitive draw 
D)  industry collapse 
E)  advertising battle

Question 15

Lucy buys a new dress at T.J.Maxx that has a price tag with "Compare at $50.00.Our Price $29.99." This is an example of the use of

Accepted Answer

A)  internal referencing. 
B)  cumulative discounts. 
C)  seasonal discounts. 
D)  base-point pricing. 
E)  an external reference price. 
A)  internal referencing. 
B)  cumulative discounts. 
C)  seasonal discounts. 
D)  base-point pricing. 
E)  an external reference price.

Question 16

Laura Spangler,of North Central Novelties,reduces the price of games sold to Robertson's Entertainment by 10 percent to allow for expenses associated with Robertson's promoting the games to consumers.This is an example of a ____ discount.

Accepted Answer

A)  quantity 
B)  cash 
C)  seasonal 
D)  trade 
E)  complementary 
A)  quantity 
B)  cash 
C)  seasonal 
D)  trade 
E)  complementary

Question 17

At what point does a firm maximize profit?

Accepted Answer

A)  The point at which marginal cost equals marginal revenue 
B)  The point at which the firm sells its product at the highest price 
C)  The breakeven point plus the adjusted marginal cost 
D)  The point at which marginal profits equal marginal revenue 
E)  The point at which marginal cost equals marginal profits 
A)  The point at which marginal cost equals marginal revenue 
B)  The point at which the firm sells its product at the highest price 
C)  The breakeven point plus the adjusted marginal cost 
D)  The point at which marginal profits equal marginal revenue 
E)  The point at which marginal cost equals marginal profits

Question 18

The perception of price depends on a

Accepted Answer

A)  product's actual price and consumers' expectations regarding price. 
B)  consumer's analysis of competitive prices. 
C)  consumer's reference price. 
D)  consumer's expectation of price. 
E)  product's actual price in comparison with the manufacturer's suggested price. 
A)  product's actual price and consumers' expectations regarding price. 
B)  consumer's analysis of competitive prices. 
C)  consumer's reference price. 
D)  consumer's expectation of price. 
E)  product's actual price in comparison with the manufacturer's suggested price.

Question 19

Safe Auto advertises its low-cost automobile insurance as "minimum coverage for minimum budgets." Safe Auto is engaging in

Accepted Answer

A)  non-price competition. 
B)  demand-based pricing. 
C)  prestige pricing. 
D)  price differentiation. 
E)  price competition. 
A)  non-price competition. 
B)  demand-based pricing. 
C)  prestige pricing. 
D)  price differentiation. 
E)  price competition.

Question 20

Discuss the role of product costs in setting prices.

Accepted Answer

Product costs play a crucial role in set

Exam 19: Strategic Pricing Management

Identify and describe the major types of discounts used for business markets.Then explain the reasons for using each type.

The legality of uniform geographic pricing has been challenged,and so its use has been abandoned.

A firm can survive in the long run only if its products are sold below cost.

Marketers generally view ____ as the minimum price a product can be sold for.

Pricing whereby the buyer absorbs all or part of the freight costs is freight absorption pricing.

A deduction from list price for purchasing large quantities aggregated over a stated period of time is a

Sellers using nonprice competition are not concerned with prices charged by competitors.

A seller can change prices quickly in a price-competition situation.

F.O.B.factory denotes the price of the products at the factory.If the price is quoted as F.O.B.shipping,then shipping costs are paid by the seller.

The fact that a gas station in Texas pays less for fuel than a gas station in Maine from a producer in Louisiana suggests that refineries are using which of the following pricing methods?

Markum Industries determines that for its air compressors the following results are achieved at a price of $250: total costs = $250,000; variable costs per unit = $100; fixed costs = $175,000.Given these figures,Markum would break even at ____ units.

Nonprice competition allows a company to increase its brand's unit sales through means other than changing the brand's price.

Total costs are influenced by quantities sold.

A danger associated with engaging in price competition is that competitors can also change prices quickly and aggressively,which can result in a(n)____ that will be harmful to both companies.

Lucy buys a new dress at T.J.Maxx that has a price tag with "Compare at $50.00.Our Price $29.99." This is an example of the use of

Laura Spangler,of North Central Novelties,reduces the price of games sold to Robertson's Entertainment by 10 percent to allow for expenses associated with Robertson's promoting the games to consumers.This is an example of a ____ discount.

At what point does a firm maximize profit?

The perception of price depends on a

Safe Auto advertises its low-cost automobile insurance as "minimum coverage for minimum budgets." Safe Auto is engaging in

Discuss the role of product costs in setting prices.

Strategic Marketing Management

Developing and Implementing Marketing Strategies

The Global Marketing Environment

Information for Marketing Decisions

Selecting Target Markets

Consumer Behavior

Business Buying Behavior

International Marketing

Digital Marketing and Social Media

Product Decisions

Strategic Product Management

Services Marketing

Strategic Management of Branding and Packaging

A Supply Chain Management and Marketing Channels

B Supply Chain Management and Marketing Channels

A Retailing,wholesaling and Direct Marketing

B Retailing,wholesaling and Direct Marketing

Integrated Marketing Communications

Advertising and Publicrelations

Personal Selling and Sales Promotion

Pricingdecisions

Global Issues,social Responsibility and Marketing

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