Question 1

Mrs. Renfro's, Inc., sells 25 different relishes in 45 different states. It's Chipotle Corn Salsa is so popular that the company struggles to keep its resellers stocked. At $4.50 a jar, its price seems just right to consumers who savor its hot and spicy taste. The popularity of spicy food is an example of a __________ that Mrs. Renfro's has capitalized on here.

Accepted Answer

A)  barter factor
B)  demand factor
C)  supply factor
D)  consumer index
E)  macroeconomic environmental factorF) All of the above
G) A) and B)

Question 2

Inelastic demand exists when

Accepted Answer

A)  a small percentage decrease in price produces a smaller percentage increase in quantity demanded.
B)  a small percentage increase in price produces a larger percentage increase in quantity demanded.
C)  an increase in price is impossible due to government restrictions.
D)  the quantity demanded remains the same regardless of any changes in marketing strategies.
E)  a small percentage decrease in price produces a smaller percentage increase in quantity supplied.F) None of the above
G) C) and D)

Question 3

Southern gardeners normally pay $5 for a 2-cubit-foot bag of pine bark mulch that they buy at their local gardening-supply and home-improvement stores to keep the weeds down in their gardens. If the price being charged by a retailer is not within a narrow range that gardeners feel is appropriate, they will use substitutions - newspaper, grass clippings, or some other kind of ground covering. When pricing pine bark mulch, a garden-supply or home-improvement retailer should use

Accepted Answer

A)  customary pricing.
B)  at-market pricing.
C)  loss-leader pricing.
D)  penetration pricing.
E)  bundle pricing.F) A) and D)
G) C) and D)

Question 4

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.F) D) and E)
G) A) and D)

Question 5

Which of the following illustrates a shift in the demand curve?

Accepted Answer

A)  When prices remain the same, there is a significant decrease in demand.
B)  As the price is raised, the quantity demanded increases, assuming all else stays the same.
C)  When prices remain the same, there is an increase or decrease in demand.
D)  As the price is lowered, the quantity demanded decreases, assuming all else stays the same.
E)  An internal matter has forced a price change of some type, but it does not impact demand.F) A) and C)
G) C) and D)

Question 6

What is bait and switch? Give an example of it.

Accepted Answer

Bait and switch is a common deceptive pr...

Question 7

Another name for a one-price policy is

Accepted Answer

A)  customary pricing.
B)  fixed pricing.
C)  dynamic pricing.
D)  standard markup pricing.
E)  uniform pricing.F) B) and E)
G) A) and B)

Question 8

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 containedF) B) and E)
G) B) and D)

Question 9

Which of the following statements is most accurate?

Accepted Answer

A)  For some products, price influences the perception of overall quality, and ultimately value, to consumers.
B)  A consumer's view of a product's value is always tied to quality.
C)  A consumer's view of value is a function of his or her education and income.
D)  Price plays only a small part in a consumer's perceived value of a product or service.
E)  Price plays a large role in assessing value but a very minor role in assessing quality.F) A) and B)
G) C) and E)

Question 10

You are selling a new line of T-shirts on the boardwalk. The selling price will be $25 per shirt. The labor cost is $5 per shirt. The administrative costs of operating the company are estimated to be $60,000 annually and the sales and marketing expenses are $20,000 a year. Additionally, the cost of materials will be $10 per shirt. What is the break-even quantity?

Accepted Answer

A)  2,000 shirts
B)  3,200 shirts
C)  5,334 shirts
D)  8,000 shirts
E)  16,000 shirtsF) A) and E)
G) None of the above

Question 11

Why do manufacturers offer seasonal discounts to channel members? Provide an example of how one would work.

Accepted Answer

To encourage buyers to stock inventory e...

Question 12

A manufacturer of a digital video recorder (DVR)  is thinking of using a skimming pricing strategy for its new product. Which of the following conditions would argue AGAINST using a skimming pricing strategy for the DVR?

Accepted Answer

A)  large potential market, even at a high price
B)  technological problems still exist for competitors
C)  increasing volume reduces production costs substantially
D)  consumers perceive a price-quality relationship
E)  consumers are innovatorsF) B) and E)
G) A) and B)

Question 13

Price elasticity of demand (E)  is expressed as (∆ means change) :

Accepted Answer

A)  E = Percentage change in price (%∆ in P)  ÷ Percentage change in quantity demanded (%∆ in Q) .
B)  E = Price (P)  ÷ Quantity demanded (Q) .
C)  E = Percentage change in quantity demanded (%∆ in Q)  ÷ Percentage change in price (%∆ in P) .
D)  E = Quantity demanded (Q)  ÷ Price (P) .
E)  E = Quantity demanded (Q)  × Price (P) .F) All of the above
G) C) and E)

Question 14

A one-price policy refers to

Accepted Answer

A)  setting different prices for products and services in real time in response to supply and demand conditions.
B)  setting the price of an entire line of products at a single specific pricing point.
C)  simultaneously setting 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.
D)  adding a fixed percentage to the cost of all items in a specific product class.
E)  setting one price for all buyers of a product or serviceF) A) and D)
G) B) and E)

Question 15

You can buy a General Electric dishwasher for $399 or you can buy a similar Bosch brand dishwasher for $989. Since Bosch uses its pricing strategy to project a high-quality product image, it is most likely using __________ pricing.

Accepted Answer

A)  bundle
B)  standard markup
C)  prestige
D)  penetration
E)  cost plus fixed-feeF) D) and E)
G) B) and E)

Question 16

A penetration pricing policy is most likely to be effective when

Accepted Answer

A)  unit production and marketing costs fall dramatically as production volumes increase.
B)  enough prospective customers are willing to buy immediately at the high initial price to make these sales profitable.
C)  lowering the price has only a minor effect on increasing the sales volume and reducing the unit cost.
D)  the high initial price will not attract competitors.
E)  customers interpret the high price as signifying high quality.F) B) and C)
G) A) and E)

Question 17

Specifying the role of price in an organization's marketing and strategic plans is referred to as

Accepted Answer

A)  choosing a pricing plan.
B)  defining a profit mission.
C)  developing pricing constraints.
D)  setting pricing objectives.
E)  determining the list or quoted priceF) A) and E)
G) None of the above

Question 18

The acronym EDLP stands for __________.

Accepted Answer

A)  estimated discount leveling policy
B)  extended discounts for leading products
C)  everyday low pricing
D)  either (free)  delivery or lower prices
E)  extended discounts in lieu of lower pricingF) B) and E)
G) A) and C)

Question 19

Vertical price fixing refers to

Accepted Answer

A)  two or more competitors explicitly or implicitly setting prices.
B)  the practice of charging different prices to different buyers for goods of like grade and quality.
C)  controlling agreements between independent buyers and sellers whereby sellers are required not to sell products below a minimum retail price.
D)  a conspiracy among firms to set prices for a product or service.
E)  a seller's requirement that the purchaser of one product also buy another product in the lineF) A) and D)
G) A) and E)

Question 20

Factors that limit the range of prices a firm may set are referred to as __________.

Accepted Answer

A)  pricing boundaries
B)  pricing constraints
C)  demand factors
D)  pricing barriers
E)  pricing restrictionsF) D) and E)
G) A) and E)

Exam 11: Pricing Products and Services

What is bait and switch? Give an example of it.

Correct Answer
verified
Bait and switch is a common deceptive pr...
View Answer

Another name for a one-price policy is

Correct Answer
verified

The acronym EDLP stands for __________.

Correct Answer
verified

Why do manufacturers offer seasonal discounts to channel members? Provide an example of how one would work.

Correct Answer
verified
To encourage buyers to stock inventory e...
View Answer

Inelastic demand exists when

Correct Answer
verified

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?

Correct Answer
verified

Correct Answer
verified

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

Correct Answer
verified

Correct Answer
verified

You can buy a General Electric dishwasher for $399 or you can buy a similar Bosch brand dishwasher for $989. Since Bosch uses its pricing strategy to project a high-quality product image, it is most likely using __________ pricing.

Correct Answer
verified

Which of the following illustrates a shift in the demand curve?

Correct Answer
verified

Price elasticity of demand (E) is expressed as (∆ means change) :

Correct Answer
verified

A one-price policy refers to

Correct Answer
verified

Vertical price fixing refers to

Correct Answer
verified

Specifying the role of price in an organization's marketing and strategic plans is referred to as

Correct Answer
verified

Which of the following statements is most accurate?

Correct Answer
verified

Correct Answer
verified

A penetration pricing policy is most likely to be effective when

Correct Answer
verified

A manufacturer of a digital video recorder (DVR) is thinking of using a skimming pricing strategy for its new product. Which of the following conditions would argue AGAINST using a skimming pricing strategy for the DVR?

Correct Answer
verified

Factors that limit the range of prices a firm may set are referred to as __________.

Correct Answer
verified

Exam 11: Pricing Products and Services

What is bait and switch? Give an example of it.

Correct AnswerverifiedBait and switch is a common deceptive pr...View AnswerShow Answer

Another name for a one-price policy is

Correct AnswerverifiedShow Answer

The acronym EDLP stands for __________.

Correct AnswerverifiedShow Answer

Why do manufacturers offer seasonal discounts to channel members? Provide an example of how one would work.

Correct AnswerverifiedTo encourage buyers to stock inventory e...View AnswerShow Answer

Inelastic demand exists when

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

You can buy a General Electric dishwasher for $399 or you can buy a similar Bosch brand dishwasher for $989. Since Bosch uses its pricing strategy to project a high-quality product image, it is most likely using __________ pricing.

Correct AnswerverifiedShow Answer

Which of the following illustrates a shift in the demand curve?

Correct AnswerverifiedShow Answer

Price elasticity of demand (E) is expressed as (∆ means change) :

Correct AnswerverifiedShow Answer

A one-price policy refers to

Correct AnswerverifiedShow Answer

Vertical price fixing refers to

Correct AnswerverifiedShow Answer

Specifying the role of price in an organization's marketing and strategic plans is referred to as

Correct AnswerverifiedShow Answer

Which of the following statements is most accurate?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A penetration pricing policy is most likely to be effective when

Correct AnswerverifiedShow Answer

A manufacturer of a digital video recorder (DVR) is thinking of using a skimming pricing strategy for its new product. Which of the following conditions would argue AGAINST using a skimming pricing strategy for the DVR?

Correct AnswerverifiedShow Answer

Factors that limit the range of prices a firm may set are referred to as __________.

Correct AnswerverifiedShow Answer

Correct Answer
verified
Bait and switch is a common deceptive pr...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
To encourage buyers to stock inventory e...
View Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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