Question 1

As a small firm in a commodity industry,you are often faced with a pricing policy that can best be described as "going-rate pricing." Explain how this pricing policy works.

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Question 2

IKEA and Southwest Airlines are among the best practitioners of value pricing-win loyal customers by charging a fairly low price for a high-quality offering.Why is value pricing not a matter of simply lowering prices

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Question 3

Your local retailer has instituted an EDLP pricing program for his stores.What would one of the reasons be for the retailer to adopt an EDLP pricing policy

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Question 4

How do EDLP and high-low pricing strategies affect consumer price judgments

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Question 5

As the marketing manager for your product,you have been forced to take a price increase due to cost pressures from your suppliers.After adjusting for customer and consumer demand fluctuations and elasticity,you feel that you have accounted for all possible reactions.Your boss,however,feels differently and says that your recommendations are not complete.What other factors,besides consumer/customers,are affected by price changes?

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Question 6

When is price discrimination legal

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...

Question 7

Movie matinees are priced lower than the evening shows; afternoon ball games are sometimes priced cheaper than the evening games,television advertising costs less when run after midnight.These are examples of what type of price discrimination

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Question 8

When a company initiates a price cut in an attempt to dominate the market through lower costs (such as the $1.00 special lunch menus at key fast-food restaurants),the company must ensure that it does not fall into certain low-cost traps.List these four "traps."

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Question 9

Your company has recently sold its resin-producing plant in India to a local concern.As part of the sales price,your company agrees to accept as partial payment the production of the resin at an agreed upon price for six years.This is an example of what type of countertrade

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Question 10

In attempt to "rein in" the continued discounting by the sales force,you implement a net price analysis program to arrive at the "real price" of your products.Describe the steps necessary to implement such a program.

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Quiz 14: Developing Pricing Strategies and Programs