Exam 14: Arriving at the Final Price

The manager of a small gasoline station observes that while gasoline sales have been steady,the service side of the business has fallen off,and mechanics are often idle.He decides to offer a promotion-a $20 off coupon for an oil change that is to be mailed to 800 households within a 2-mile radius from the gas station.The cost of printing and mailing is $1,000.The normal cost of an oil change is $40.Materials and labor per oil change cost is $15.How many additional maintenance service jobs must result for the promotion to break even?

FOB origin pricing refers to

Price deals that mislead consumers fall into the category of

Figure 14-1 above represents the six steps in setting price.Which letter represents the step where a firm would use a demand-oriented approach to setting price?

Yield management pricing refers to

Within the channel of distribution for certain types of imported furniture,the typical trade terms are 40/15/10.If a dining room table has a list price of $1,000,how much would the manufacturer sell the table to a jobber for?

For which of the following products is its manufacturer most likely to use basing-point pricing?

Functional discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

In response to Duracell's introduction of the Duracell Ultra battery,Energizer introduced an Advanced Formula battery.But unlike Duracell,Energizer priced its batteries at a low initial price to attract the mass market.Was Energizer's pricing strategy to take market share from Duracell a success?

A dynamic pricing policy gives marketers __________ in setting the final price in light of demand,cost,and competitive factors.

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

Figure 14-1 above represents the six steps in setting price.Which letter represents the step where a firm would offer discounts?

The 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

Yield management pricing is a form of

A penetration pricing policy is MOST LIKELY to be effective when: (1)many segments of the market are price sensitive; (2)a low initial price discourages competitors from entering the market;and (3)_________.

While the most commonly used pricing method for business products is cost-plus pricing,this method is becoming more and more popular among __________ in the service sector.

Penetration pricing refers to

Talbot's sells women's clothes.A longsleeve scoopneck t-shirt with the Talbot's label costs $45.By comparison,you can buy a t-shirt for $5 at a Family Dollar Store,but it won't have the prestigious Talbot's label or quality.What kind of demand-oriented approach to pricing does Talbot's use?

Mike Morgan,a sales representative for a major food service distributor of Betty Crocker's Warm Delights,wanted to encourage repeat purchases by his grocery customers-supermarkets,mass merchandisers,etc.In order to accomplish this objective,Morgan offered the following discounts to his customers: a 10 percent discount for buying 1-49 cases of Warm Delights within a calendar month.The discount increases to 12 percent if 50-99 cases of Warm Delights are purchased and to 15 percent if 100 or more cases of Warm Delights are purchased within the same calendar month.What type of discount was Morgan offering his customers?

While __________ often changes price based upon color or style,__________ often changes prices based on time,day,week,or season.