Question 1

Price elasticity of demand is determined by a number of factors,such as the availability of substitutes,the necessity of the product or service,and

Accepted Answer

A) the cash outlay of the purchase relative to a person's disposable income. 
B) the stage of the product or service in its product life cycle. 
C) the degree of carrying costs for the manufacturer or distributor. 
D) the financial resources of the organization itself. 
E) the ability of the organization to meet sudden increases in demand. 
A) the cash outlay of the purchase relative to a person's disposable income. 
B) the stage of the product or service in its product life cycle. 
C) the degree of carrying costs for the manufacturer or distributor. 
D) the financial resources of the organization itself. 
E) the ability of the organization to meet sudden increases in demand.

Question 2

Making special adjustments to the list or quoted price would occur during __________ of the price-setting process.

Accepted Answer

A) Step 2 
B) Step 3 
C) Step 4 
D) Step 5 
E) Step 6 
A) Step 2 
B) Step 3 
C) Step 4 
D) Step 5 
E) Step 6

Question 3

Some specialty-toy retailers pursue a __________ pricing objective to generate cash to ward off bankruptcy.

Accepted Answer

A) market share 
B) survival 
C) sales revenue 
D) single product line 
E) profit 
A) market share 
B) survival 
C) sales revenue 
D) single product line 
E) profit

Question 4

Price elasticity of demand measures how sensitive consumer demand and the firm's revenues are to changes in the product's price.Explain the difference between a product with elastic demand and a product with inelastic demand.

Accepted Answer

Elastic demand exists when a small perce

Question 5

Setting list or quoted prices would occur during __________ of the price-setting process.

Accepted Answer

A) Step 1 
B) Step 2 
C) Step 3 
D) Step 4 
E) Step 5 
A) Step 1 
B) Step 2 
C) Step 3 
D) Step 4 
E) Step 5

Question 6

Three different objectives relate to a firm's profit,which have different implications for pricing strategy.The three profit-oriented objectives include managing for long-run profits,maximizing current profit objectives,and __________.

Accepted Answer

A) accumulating profits 
B) reinvesting profits 
C) redistributing profits 
D) maximizing gross margin 
E) achieving a target return 
A) accumulating profits 
B) reinvesting profits 
C) redistributing profits 
D) maximizing gross margin 
E) achieving a target return

Question 7

Economists have identified four types of competitive markets: pure monopoly,pure competition,oligopoly,and __________.

Accepted Answer

A) capitalism 
B) socialism 
C) monopolistic competition 
D) consumer-dominated 
E) government-dominated 
A) capitalism 
B) socialism 
C) monopolistic competition 
D) consumer-dominated 
E) government-dominated

Question 8

Figure 13-7 above shows that the average revenue at point "C" is

Accepted Answer

A) $4. 
B) $5. 
C) $6. 
D) $8. 
E) $10. 
A) $4. 
B) $5. 
C) $6. 
D) $8. 
E) $10.

Question 9

Walmart uses which pricing strategy that affects both customers and competitors?

Accepted Answer

A) penetration pricing 
B) every day fair pricing 
C) every day low pricing 
D) supply-side pricing 
E) value-pricing 
A) penetration pricing 
B) every day fair pricing 
C) every day low pricing 
D) supply-side pricing 
E) value-pricing

Question 10

In Figure 13-4 above,column "B" represents which type of competitive market?

Accepted Answer

A) pure monopoly 
B) oligopoly 
C) monopolistic competition 
D) pure competition 
E) monopolistic oligopoly 
A) pure monopoly 
B) oligopoly 
C) monopolistic competition 
D) pure competition 
E) monopolistic oligopoly

Question 11

Rent,executive salaries,and insurance are typical examples of

Accepted Answer

A) variable costs. 
B) fixed costs. 
C) unit costs. 
D) marginal costs. 
E) total costs. 
A) variable costs. 
B) fixed costs. 
C) unit costs. 
D) marginal costs. 
E) total costs.

Question 12

The maximum quantity of products consumers will buy at given price is shown by

Accepted Answer

A) a demand curve. 
B) a price constraint. 
C) a break-even point. 
D) a supply curve. 
E) a marginal revenue curve. 
A) a demand curve. 
B) a price constraint. 
C) a break-even point. 
D) a supply curve. 
E) a marginal revenue curve.

Question 13

According to Figure 13-7 above,what is the price for Red Baron frozen cheese pizzas when marginal revenue is $0?

Accepted Answer

A) $0 
B) $2 
C) $4 
D) $8 
E) $12 
A) $0 
B) $2 
C) $4 
D) $8 
E) $12

Question 14

Which of the following would be an example of a fixed cost for a company that makes carbon monoxide monitoring systems for employees to wear that work in hazardous areas?

Accepted Answer

A) the lithium batteries that are used in each monitor 
B) the chest harness used to wear the monitor 
C) the insurance for the company's factory 
D) the free training videos that are sent to each new customer 
E) the stainless steel,water-resistant cases in which the monitors are contained 
A) the lithium batteries that are used in each monitor 
B) the chest harness used to wear the monitor 
C) the insurance for the company's factory 
D) the free training videos that are sent to each new customer 
E) the stainless steel,water-resistant cases in which the monitors are contained

Question 15

Which term describes factors that limit the range of prices a firm may set?

Accepted Answer

A) price fixings 
B) pricing constraints 
C) price elasticities 
D) pricing demands 
E) pricing margins 
A) price fixings 
B) pricing constraints 
C) price elasticities 
D) pricing demands 
E) pricing margins

Question 16

To reduce the price sensitivity for some of its products,Washburn

Accepted Answer

A) uses multiple suppliers for its raw materials. 
B) offers three months of free music lessons with the purchase of each guitar. 
C) uses endorsements by internationally known musicians who play Washburn signature guitars. 
D) offers a lifetime,unconditional warranty on all its instruments regardless of the price of its guitars. 
E) sponsors free music programs and special Washburn guitar camps for children. 
A) uses multiple suppliers for its raw materials. 
B) offers three months of free music lessons with the purchase of each guitar. 
C) uses endorsements by internationally known musicians who play Washburn signature guitars. 
D) offers a lifetime,unconditional warranty on all its instruments regardless of the price of its guitars. 
E) sponsors free music programs and special Washburn guitar camps for children.

Question 17

According to the price equation,a product's or service's final price equals its list price minus incentives and allowances plus

Accepted Answer

A) profits. 
B) commissions. 
C) trade-ins. 
D) extra fees. 
E) taxes. 
A) profits. 
B) commissions. 
C) trade-ins. 
D) extra fees. 
E) taxes.

Question 18

A pair of $200 designer denim jeans cost so much because

Accepted Answer

A) the labor to make them comprises the largest percentage of the final price. 
B) the marketer must cover all of its operating costs while earning a profit. 
C) the specialty retailers that sell them account for only 25% of the cost so that the jeans can experience "demand pull." 
D) the contract manufacturer for the jeans receives the least percentage of the final price. 
E) the marketer of the designer denim jeans makes the largest percentage of the final price. 
A) the labor to make them comprises the largest percentage of the final price. 
B) the marketer must cover all of its operating costs while earning a profit. 
C) the specialty retailers that sell them account for only 25% of the cost so that the jeans can experience "demand pull." 
D) the contract manufacturer for the jeans receives the least percentage of the final price. 
E) the marketer of the designer denim jeans makes the largest percentage of the final price.

Question 19

During the __________ stage of its product life cycle,a firm has great latitude in setting and maintaining a premium price.

Accepted Answer

A) decline 
B) maturity 
C) growth 
D) accelerated development 
E) introduction 
A) decline 
B) maturity 
C) growth 
D) accelerated development 
E) introduction

Question 20

Tara is enrolled for spring semester at college.The tuition is $6,000,but she has a scholarship for $1,000 as well as a work-study grant of $1,500.The health fees and student activity fees are $150 for the semester.What is the final price that Tara will pay for the spring semester?

Accepted Answer

A) $2,500 
B) $2,650 
C) $3,150 
D) $3,650 
E) $6,150 
A) $2,500 
B) $2,650 
C) $3,150 
D) $3,650 
E) $6,150

Exam 13: Building the Price Foundation

Price elasticity of demand is determined by a number of factors,such as the availability of substitutes,the necessity of the product or service,and

Making special adjustments to the list or quoted price would occur during __________ of the price-setting process.

Some specialty-toy retailers pursue a __________ pricing objective to generate cash to ward off bankruptcy.

Price elasticity of demand measures how sensitive consumer demand and the firm's revenues are to changes in the product's price.Explain the difference between a product with elastic demand and a product with inelastic demand.

Setting list or quoted prices would occur during __________ of the price-setting process.

Three different objectives relate to a firm's profit,which have different implications for pricing strategy.The three profit-oriented objectives include managing for long-run profits,maximizing current profit objectives,and __________.

Economists have identified four types of competitive markets: pure monopoly,pure competition,oligopoly,and __________.

Figure 13-7 above shows that the average revenue at point "C" is

Walmart uses which pricing strategy that affects both customers and competitors?

In Figure 13-4 above,column "B" represents which type of competitive market?

Rent,executive salaries,and insurance are typical examples of

The maximum quantity of products consumers will buy at given price is shown by

According to Figure 13-7 above,what is the price for Red Baron frozen cheese pizzas when marginal revenue is $0?

Which of the following would be an example of a fixed cost for a company that makes carbon monoxide monitoring systems for employees to wear that work in hazardous areas?

Which term describes factors that limit the range of prices a firm may set?

To reduce the price sensitivity for some of its products,Washburn

According to the price equation,a product's or service's final price equals its list price minus incentives and allowances plus

A pair of $200 designer denim jeans cost so much because

During the __________ stage of its product life cycle,a firm has great latitude in setting and maintaining a premium price.

Tara is enrolled for spring semester at college.The tuition is $6,000,but she has a scholarship for $1,000 as well as a work-study grant of $1,500.The health fees and student activity fees are $150 for the semester.What is the final price that Tara will pay for the spring semester?

Creating Customer Relationships and Value Through Marketing

Developing Successful Organizational and Marketing Strategies

Scanning the Marketing Environment

Ethical and Social Responsibility in 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

Arriving at the Final Price

Managing Marketing Channels and Supply Chains

Retailing and Wholesaling

Integrated Marketing Communications and Direct Marketing

Advertising, Sales Promotion, and Public Relations

Using Social Media to Connect With Consumers

Personal Selling and Sales Management

Implementing Interactive and Multichannel Marketing

Pulling It All Together: the Strategic Marketing Process

Building an Effective Marketing Plan

Financial Aspects of Marketing

Filters