Question 1

In the area of international pricing, sellers and buyers usually prefer a quote in their domestic currency.

Accepted Answer

A) True 
 B)False

Question 2

__________________ uses the market mechanism as a cue for setting transfer prices.

Accepted Answer

A)  Local-currency price stability (LCPS) pricing 
B)  Pricing-to-market (PTM) 
C)  Market-based pricing 
D)  Countertrade pricing 
E)  Nonmarket-based pricing

Question 3

Transfer pricing decisions in an international context need to balance off the interests of a broad range of stakeholders. All of the following would be examples
Of those stakeholders EXCEPT:

Accepted Answer

A)  the parent company. 
B)  the competition. 
C)  local country managers. 
D)  host government(s). 
E)  the domestic government.

Question 4

A stronger U.S. dollar undermines the competitive position of American exports.

Accepted Answer

A) True 
 B)False

Question 5

According to a recent research, all of the following are examples of important pricing objectives EXCEPT:

Accepted Answer

A)  drive competition out of business. 
B)  to achieve a satisfactory return on investment. 
C)  maintain market share. 
D)  expand market share. 
E)  to meet a specified profit goal.

Question 6

Countertrade purchase is not the most popular form of countertrade.

Accepted Answer

A) True 
 B)False

Question 7

If an exporter were to stress price benefits, the exporter would probably be facing
a domestic currency that was perceived as being weak.

Accepted Answer

A) True 
 B)False

Question 8

All of the following are exporter strategies when the domestic currency is weak EXCEPT:

Accepted Answer

A)  stress price benefits. 
B)  engage in nonprice competition by improving quality, delivery, and aftersale service. 
C)  expand the product line and add more. 
D)  shift sourcing and manufacturing to domestic market. 
E)  exploit export opportunities in all markets.

Question 9

Examples of exporting-related ____________________ include manufacturing costs, shipping expenses, insurance, and overseas promotional costs.

Accepted Answer

A)  incremental costs 
B)  demand costs 
C)  fixed costs 
D)  target costs 
E)  service costs

Question 10

When making pricing decisions, ______________ set(s) the floor.

Accepted Answer

A)  profits 
B)  costs 
C)  demand 
D)  supply 
E)  service

Question 11

If a firm decide to penetrate the Japanese consumer market through direct marketing (such as catalog or telemarketing sales). Which of the following strategies best
Describes this option for lowering the price of an exported product?

Accepted Answer

A)  rearrange the distribution channel. 
B)  eliminate costly features (or make them optional). 
C)  downsize the product. 
D)  expand the warranty categories to give incentive for higher quality. 
E)  assemble or manufacture the product in foreign markets.

Question 12

An example of nonprice competition that is faced in some markets is:

Accepted Answer

A)  retailer sales. 
B)  discounts. 
C)  coupons. 
D)  advertising. 
E)  cents-off deals.

Question 13

Negotiated transfer pricing is another form of nonmarket-based pricing.

Accepted Answer

A) True 
 B)False

Question 14

Multinationals do not need to take antidumping laws into account when determining
their global pricing strategy.

Accepted Answer

A) True 
 B)False

Question 15

VER is an acronym for:

Accepted Answer

The answer of VER is an acronym for:...

Question 16

Wide gaps in the price sensitivity between countries for the same product may create conditions that promote _________________ markets.

Accepted Answer

A)  backward 
B)  gray 
C)  white 
D)  demand 
E)  forward

Question 17

In the international marketplace, _________________ pricing adds international costs and a mark-up to the domestic manufacturing cost.

Accepted Answer

A)  dynamic incremental pricing 
B)  export price 
C)  import price 
D)  cost-plus price 
E)  target-return price

Question 18

Firms faced with price controls can take any of the following strategies EXCEPT:

Accepted Answer

A)  shift the target segment or markets. 
B)  launch new products or variants of existing products. 
C)  negotiate with the government. 
D)  predict the incidence of price controls. 
E)  have the home government bring pressure on the host government.

Question 19

To combat hyperinflation, governments occasionally impose price controls.

Accepted Answer

A) True 
 B)False

Question 20

When considering the currency pass-through phenomenon, all of the following factors give an indication as to the appropriate action EXCEPT:

Accepted Answer

A)  the customer's price sensitivity. 
B)  government actions. 
C)  the impact of dollar appreciation on the firm's cost structure. 
D)  the impact of dollar depreciation on the firm's cost structure. 
E)  the amount of competition in the export market.

Exam 12: Global Pricing

In the area of international pricing, sellers and buyers usually prefer a quote in their domestic currency.

__________________ uses the market mechanism as a cue for setting transfer prices.

Transfer pricing decisions in an international context need to balance off the interests of a broad range of stakeholders. All of the following would be examples Of those stakeholders EXCEPT:

A stronger U.S. dollar undermines the competitive position of American exports.

According to a recent research, all of the following are examples of important pricing objectives EXCEPT:

Countertrade purchase is not the most popular form of countertrade.

If an exporter were to stress price benefits, the exporter would probably be facing a domestic currency that was perceived as being weak.

All of the following are exporter strategies when the domestic currency is weak EXCEPT:

Examples of exporting-related ____________________ include manufacturing costs, shipping expenses, insurance, and overseas promotional costs.

When making pricing decisions, ______________ set(s) the floor.

If a firm decide to penetrate the Japanese consumer market through direct marketing (such as catalog or telemarketing sales) . Which of the following strategies best Describes this option for lowering the price of an exported product?

An example of nonprice competition that is faced in some markets is:

Negotiated transfer pricing is another form of nonmarket-based pricing.

Multinationals do not need to take antidumping laws into account when determining their global pricing strategy.

VER is an acronym for:

Wide gaps in the price sensitivity between countries for the same product may create conditions that promote _________________ markets.

In the international marketplace, _________________ pricing adds international costs and a mark-up to the domestic manufacturing cost.

Firms faced with price controls can take any of the following strategies EXCEPT:

To combat hyperinflation, governments occasionally impose price controls.

When considering the currency pass-through phenomenon, all of the following factors give an indication as to the appropriate action EXCEPT: