Question 1

A company faces fixed costs of $100,000 and variable costs of $8.00/unit.They plan to directly sell their product to the market for $12.00.How many units must they produce and sell to break even?
20,000
25,000
40,000
50,000
not enough information to calculate

Accepted Answer

The answer of A company faces fixed costs of $100,000...

Question 2

When a manufacturer offers a ________, customers buy products from manufacturers' dealers within a specified time period and the manufacturer sends the customer a check.
cash rebate
special event price
dealer reduction
promotional pricing reward
discount allowance

Accepted Answer

The answer of When a manufacturer offers a ________, customers...

Question 3

Price discrimination is legal under which of the following conditions?
when a manufacturer and reseller have agreed upon a specified retail price for a product
when a manufacturer sells to retailers in different markets
if a seller can prove its costs per unit are different when selling to different retailers
if a seller advertises prices that are not actually available to consumers
if a seller has not communicated with competitors before announcing prices

Accepted Answer

The answer of Price discrimination is legal under which of...

Question 4

When a competitor cuts its price, a company might decide to ________ if it believes it will not lose much market share or would lose too much profit by cutting its own price.
reduce its production costs
reduce its marketing costs
maintain its current price and profit margin
increase its marketing budget to raise the perceived value of its product
increase its production costs to improve the quality of the product

Accepted Answer

The answer of When a competitor cuts its price, a...

Question 5

Under which type of geographic pricing strategy does each customer pay the exact freight for the product from the factory to its destination?
basing-point pricing
freight-absorption pricing
FOB-origin pricing
dynamic pricing
zone pricing

Accepted Answer

The answer of Under which type of geographic pricing strategy...

Question 6

Which of the following is a reason for a company to raise its prices?
to address the issue of overdemand for a product
to win a larger share of the market
to use excess capacity
to boost sales volume
to balance out decreasing costs

Accepted Answer

The answer of Which of the following is a reason...

Question 7

The Internet offers ________, where the price can easily be adjusted to meet changes in demand.
captive pricing
dynamic pricing
basing-point pricing
price bundling
cost-plus pricing

Accepted Answer

The answer of The Internet offers ________, where the price...

Question 8

Which of the following is likely to be the least effective action that a company can take to combat a competitor's price cut on a product?
reduce price
raise perceived value
improve quality and increase price
bundle products together
launch a low-price "fighting brand"

Accepted Answer

The answer of Which of the following is likely to...

Question 9

Price escalation in international markets is most likely to result from the higher costs of selling in another country and differences in market conditions or ________.
cultural preferences
selling strategies
regional tastes
customer perceptions
language barriers

Accepted Answer

The answer of Price escalation in international markets is most...

Question 10

Consumers use price less to judge the quality of a product when they ________.
lack information
lack skills to use the product
have experience with the product
are shopping for a specialty item
cannot physically examine the product

Accepted Answer

The answer of Consumers use price less to judge the...

Question 11

________ prices are the prices that buyers carry in their mind and refers to when looking at a given product.
Psychological
Reference
Promotional
Geographical
Dynamic

Accepted Answer

The answer of ________ prices are the prices that buyers...

Question 12

Which of the following is the least likely reason for a company to initiate a price cut?
to boost sales
to obtain prestige
to dominate the market
to relieve excess capacity
to influence falling demand

Accepted Answer

The answer of Which of the following is the least...

Question 13

The Competition Act is the federal law that were enacted to curb the formation of ________.
unfair competition
oligopolies
competitive markets
international markets
limited partnerships

Accepted Answer

The answer of The Competition Act is the federal law...

Question 14

Xbox 360 decides to add a free subscription to XBOX magazine with every game bought in an effort to differentiate its offering from PS3 games.This is an example of ________.
good-value pricing
add-on pricing
product-support pricing
value-added pricing
cost-based pricing

Accepted Answer

The answer of Xbox 360 decides to add a free...

Question 15

Federal legislation on price-fixing requires that sellers set their prices ________.
based on their fixed and variable costs
without communication with competitors
to achieve a specified profit margin
with the intention of putting competitors out of business
consistently throughout a region

Accepted Answer

The answer of Federal legislation on price-fixing requires that sellers...

Question 16

What type of pricing is being used when a company temporarily prices its product below the list price or even below cost to create buying excitement and urgency?
segmented pricing
psychological pricing
referent pricing
promotional pricing
dynamic pricing

Accepted Answer

The answer of What type of pricing is being used...

Question 17

General Motors prices its automobiles to achieve a 15 to 20 percent profit on its investment.This approach is called ________.
value-based pricing
going-rate pricing
cost-plus pricing
low-price image
target return pricing

Accepted Answer

The answer of General Motors prices its automobiles to achieve...

Question 18

In Lima, Peru, 20 stores specializing in selling the same quality and brand of wheat products are located on one street.An individual seller cannot charge more than the going price without the risk of losing business to the other stores.This is an example of what type of market?
pure competition
monopolistic competition
oligopolistic competition
pure monopoly
socialist

Accepted Answer

The answer of In Lima, Peru, 20 stores specializing in...

Question 19

Swatch surveyed the market and identified an unserved segment of watch buyers.Using these results, they created a watch at a price consumers were willing to pay.The unorthodox order of this marketing mix decision is an example of ________.
competition-based pricing
cost-plus pricing
target costing
value-based pricing
penetration pricing

Accepted Answer

The answer of Swatch surveyed the market and identified an...

Question 20

Which of the following is the opposite of FOB-origin pricing?
basing-point pricing
absorption pricing
uniform-delivered pricing
freight-absorption pricing
zone pricing

Accepted Answer

The answer of Which of the following is the opposite...

Quiz 10: Pricing: Understanding and Capturing Customer Value

A company faces fixed costs of $100,000 and variable costs of $8.00/unit.They plan to directly sell their product to the market for $12.00.How many units must they produce and sell to break even? 20,000 25,000 40,000 50,000 not enough information to calculate

When a manufacturer offers a ________, customers buy products from manufacturers' dealers within a specified time period and the manufacturer sends the customer a check. cash rebate special event price dealer reduction promotional pricing reward discount allowance

Under which type of geographic pricing strategy does each customer pay the exact freight for the product from the factory to its destination? basing-point pricing freight-absorption pricing FOB-origin pricing dynamic pricing zone pricing

Which of the following is a reason for a company to raise its prices? to address the issue of overdemand for a product to win a larger share of the market to use excess capacity to boost sales volume to balance out decreasing costs

The Internet offers ________, where the price can easily be adjusted to meet changes in demand. captive pricing dynamic pricing basing-point pricing price bundling cost-plus pricing

Which of the following is likely to be the least effective action that a company can take to combat a competitor's price cut on a product? reduce price raise perceived value improve quality and increase price bundle products together launch a low-price "fighting brand"

Price escalation in international markets is most likely to result from the higher costs of selling in another country and differences in market conditions or ________. cultural preferences selling strategies regional tastes customer perceptions language barriers

Consumers use price less to judge the quality of a product when they ________. lack information lack skills to use the product have experience with the product are shopping for a specialty item cannot physically examine the product

________ prices are the prices that buyers carry in their mind and refers to when looking at a given product. Psychological Reference Promotional Geographical Dynamic

Which of the following is the least likely reason for a company to initiate a price cut? to boost sales to obtain prestige to dominate the market to relieve excess capacity to influence falling demand

The Competition Act is the federal law that were enacted to curb the formation of ________. unfair competition oligopolies competitive markets international markets limited partnerships

Xbox 360 decides to add a free subscription to XBOX magazine with every game bought in an effort to differentiate its offering from PS3 games.This is an example of ________. good-value pricing add-on pricing product-support pricing value-added pricing cost-based pricing

Federal legislation on price-fixing requires that sellers set their prices ________. based on their fixed and variable costs without communication with competitors to achieve a specified profit margin with the intention of putting competitors out of business consistently throughout a region

What type of pricing is being used when a company temporarily prices its product below the list price or even below cost to create buying excitement and urgency? segmented pricing psychological pricing referent pricing promotional pricing dynamic pricing

General Motors prices its automobiles to achieve a 15 to 20 percent profit on its investment.This approach is called ________. value-based pricing going-rate pricing cost-plus pricing low-price image target return pricing

Which of the following is the opposite of FOB-origin pricing? basing-point pricing absorption pricing uniform-delivered pricing freight-absorption pricing zone pricing