MAR FIN

A(n) ________ refers to promotional money paid by manufacturers to retailers in return for an agreement to feature the manufacturer's products in some way. A) allowance B) sample C) discount D) tax credit E) tax exemption

A

Developing a product or service involves defining the benefits that it will offer. These benefits are communicated and delivered by ________. A) product labels B) product attributes C) support services D) product packaging E) branding

B

In ________, text-based ads and links appear alongside search engine results on sites such as Google, Yahoo!, and Bing. A) content sponsorships B) digital billboards C) digital catalogs D) contextual advertisements E) RSS feeds

D

Costs that change with the level of production are referred to as ________. A) fixed costs B) variable costs C) target costs D) total costs E) overhead costs

B

A ________ consists of all the product lines and items that a particular seller offers for sale. A) product mix B) store brand C) supply chain D) value chain E) line extension

A

A ________ is a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same type of outlets, or fall within given price ranges. A) product line B) line extension C) private brand D) multibrand E) new brand

A

A company must pay each month's bills for rent, heat, interest, and executive salaries regardless of the company's level of output. This exemplifies its ________ costs. A) overhead B) variable C) target D) total E) unit

A

A decision to position the product on high-performance quality will mean that the ________. A) seller must charge a higher price to cover higher costs B) seller must charge a lower price to attract more customers C) producer must step down production D) marketer must boost derived demand in the market E) break-even volume will be fairly low

A

A seller offers a ________ to trade-channel members who perform certain functions, such as selling, storing, and record keeping. A) functional discount B) storage allowance C) cash discount D) promotional allowance E) quantity discount

A

According to the "Privacy Promise to American Consumers" program, DMA members need to comply with which of the following consumer privacy rules? A) agree to notify customers when any personal information is rented, sold, or exchanged with others B) offer to register all customers in the National Do Not Call Registry C) make sure that consumers are adhering to the Children's Online Privacy Protection Act D) educate consumers on the Can Spam legislation E) include the advertising option icon to let consumers know why they are being targeted

A

Bon Vivant offers an assortment of exclusive French wines at incredibly low prices. These prices are neither limited-time offers nor special discounts, but represent the daily prices of products sold by Bon Vivant. This reflects Bon Vivant's ________ pricing strategy. A) everyday low B) markup C) penetration D) break-even

A

Brand ________ refers to how highly consumers regard and respect the brand. A) esteem B) conformance C) differentiation D) relevance E) knowledge

A

By definition, ________ pricing is used when a firm sells a product or service at two or more prices, even though the difference in price is not based on differences in cost. A) segmented B) variable C) flexible D) cost-plus E) reference

A

Companies can legitimately charge a higher price if ________. A) consumers perceive that the company's product offers greater value B) the demand for products manufactured by a firm is highly elastic C) the cost of advertising is minimal D) derived demand remains constant E) consumers de-emphasize quality

A

Developing an effective integrated marketing mix program involves coordinating price decisions with product design, promotion, and ________ decisions. A) distribution B) production C) assembly D) warranty E) competition

A

Elmo Inc., a Michigan-based manufacturer of athletic shoes, uses professional athletes in its ad campaigns to help sell its products. This is an example of ________ marketing. A) person B) place C) social D) organization E) internal

A

Experience-curve pricing assumes that ________. A) competitors are weak and not willing to match price cuts B) competitors are strong and invincible C) aggressive pricing adversely affects product image D) volume-based production slows down organizational learning E) lower-cost technologies are almost always inferior

A

Fiona Lambrech is the marketing director of a newly established detergent company. In order to introduce her product effectively into the market, Fiona sends samples of the detergent to a select group of individuals. Which of the following forms of marketing was most likely used by Fiona? A) direct-mail marketing B) catalog marketing C) telephone marketing D) kiosk marketing E) direct-response television marketing

A

Fixed costs ________. A) are costs that do not vary with production or sales level B) vary directly with the level of production C) decrease with accumulated production experience D) are the sum of the overhead and variable costs for any given level of production E) represent the annual costs of inputs incurred by a company

A

Gant Hardware is a huge chain of hardware stores. GantHardware.com helps customers conduct product research and also lets them order directly online or redirects them to the nearest Gant retail store. Which of the following best describes GantHardware.com? A) marketing Web site B) digital catalog C) social network D) podcast E) blog

A

Go Zone plans to introduce four tablet models over the next year. These models range from basic readers at $99 per unit, to more sophisticated tablets at $399 per unit. The more features a model has, the more expensive it is. What pricing strategy is Tone Zone using for its range of tablets? A) product line pricing B) product bundle pricing C) captive product pricing D) by-product pricing E) optional product pricing

A

Green Gardens is a click-and-mortar company that sells gardening and landscaping goods and equipment. When customers are unable to find a product they need on the shelves of their local Green Gardens store, customers order the product online with the help of the in-store ordering machine. Which of the following best describes the ordering machine? A) kiosk B) digital catalog C) podcast D) tablet E) online networks

A

Hearth & Home, a store which sells household products, has announced a one-week sale on its new carpet line. This is an example of ________. A) promotional pricing B) seasonal pricing C) by-product pricing D) product bundle pricing E) time-based pricing

A

If a consumer purchases a new flat-screen "smart" television which can connect to services like Netflix and Pandora, what is the core customer value involved? A) connection to entertainment and information B) state-of the art technology C) slick and attractive packaging D) brand name E) tech support and warranty

A

In Viña del Mar, Chile, a large number of shops specialize in selling the same quality of seafood products along the beach frequented by tourists. No individual shop dares charge more than the going price without fearing loss of business to other shops. This exemplifies ________. A) pure competition B) monopolistic competition C) oligopolistic competition D) pure monopoly E) the dominant firm model

A

In the aftermath of the Great Recession of 2008 to 2009, consumers ________. A) have become more value conscious B) have become less value conscious C) exhibit great interest in prestige pricing D) show no interest in price cutting E) rarely endorse value-for-money deals

A

In which of the following geographic pricing strategies would customers located close to the company pay the same amount as customers in distant locations? A) uniform-delivered pricing B) zone pricing C) FOB-origin pricing D) location-based pricing E) reference pricing

A

In which situation is the market dominated by one seller? A) pure monopoly B) monopolistic competition C) oligopolistic competition D) pure competition E) free market

A

Industrial products and services include raw materials, buildings, fixed equipment, supplies, services, and ________. A) computers and desks B) electricity C) groceries D) insurance E) employees

A

James is looking for a new suit for a job interview. He is shopping at Smith & Jones, a well-regarded menswear store. While he looks at various styles and uses his smartphone to scan codes, the menswear shopping app provides him with suggestions for shirts, ties, and shoes that would complete the ensemble he needs to make a strong, positive impact at his interview. The ability of the app to provide this information serves to ________. A) enrich the shopping experience B) annoy James C) complicate the shopping experience D) use James' data plan E) interrupt the shopping experience

A

Lubricants, coal, paper, and pencils are examples of ________. A) operating supplies B) capital items C) raw materials D) specialty products E) installations

A

Marketers publicize inbound toll-free numbers to consumers in television and print ads, direct mail, and catalogs. The benefit to sellers is that it presents an opportunity for consumers to order products and for the seller to build the relationship. A benefit to consumers is ________. A) increased convenience B) increased telemarketing calls C) decreased telemarketing calls D) 24/7 availability of support E) a discounted price on the product

A

Marketing mix planning begins with ________. A) building an offering that brings value to target customers B) finding a suitable promotion strategy for the product C) setting a reasonable price for the product D) selecting the right channel for distribution of the product E) calculating the total costs involved in manufacturing the product

A

Neal Murphy sells his company's unique products on television programs. He hosts a 30-minute show in which he demonstrates and explains the advantages of the product. At the end of the show, a toll-free number is displayed on the screen that can be used by viewers to place their orders for the product. Which of the following forms of advertising is evident here? A) direct-response television advertising B) telemarketing C) interactive television marketing D) podcast marketing E) kiosk marketing

A

Price discrimination may be used to match competition as long as the strategy is temporary, localized, and ________. A) defensive B) offensive C) publicized D) private E) uniform across channels

A

Price setting is usually determined by ________ in small companies. A) the top managers B) the marketing department C) the sales department D) divisional managers E) product managers

A

Product mix ________ refers to the total number of items a company carries within its product lines. A) length B) depth C) height D) width E) consistency

A

Sales executives at Keiron Air Conditioners use phone directories to call customers and convince them to buy their air conditioners. Which form of direct marketing is used here? A) telemarketing B) direct-mail marketing C) catalog marketing D) direct-response television marketing E) kiosk marketing

A

Service productivity can be increased by hiring new employees who will work harder, by giving up some quality, or by ________. A) using technology more effectively B) outsourcing portions of the process to other firms C) creating more self-serve opportunities for customers D) reducing the number of products offered E) increasing the price on some of the product line

A

Social media are all of the following EXCEPT ________. A) expensive B) interactive C) personal D) targeted E) timely

A

Sparkling Valley, a luxury resort, prices cottages facing the lake higher than cottages that do not, even though the cottages and services offered are identical in every other aspect. This form of pricing is called ________ pricing. A) location-based B) time-based C) by-product D) seasonal E) captive product

A

A(n) ________ is designed to present brand content that engages consumers and creates customer-brand community. A) podcast B) branded community Web site C) search engine D) digital catalog E) online magazine

B

Spartan Sportsgear is a company that sells sports equipment for adventure sports. It recently launched ExtremeSpartan.com to showcase products and provide testimonials of famous adventure sports athletes who use Spartan's products. It also includes videos and blogs. Which of the following best describes ExtremeSpartan.com? A) branded community Web site B) digital catalog C) social network D) podcast E) blog

A

The "bottom of the pyramid" refers to ________. A) the world's poorest consumers B) the middle classes of Brazil, Russia, India, and China C) a market with little or no purchasing power D) people with easy access to luxury goods E) the middle class of high-income countries

A

The Sherman, Clayton, and Robinson-Patman Acts are all federal laws that were enacted to curb the formation of ________. A) monopolies B) global partnerships C) competitive markets D) internal markets E) intrastate partnerships

A

The ________ was established by the Direct Marketing Association. A) Privacy Promise to American Consumers B) Trusted Email Open Standard C) Children's Online Privacy Protection Act D) CAN-SPAM legislation E) Do Not Call Registry

A

The break-even volume is the point at which ________. A) the total revenue and total cost curves intersect B) demand equals supply C) the production of one more unit will not lead to increase in demand D) the company can pay off all its long-term debt E) a firm exceeds the sales forecast

A

The long-run average cost (LRAC) curve indicates the ________. A) per unit cost of output in the long run B) projected total production costs of competitors C) variable costs incurred by a firm over time D) fixed costs incurred by a firm over the long term E) number of units the market will buy in a given time period, at different prices that might be charged

A

Titan Inc., an automobile manufacturer based in Utah, recently added two new models to its existing line of sedans in order to increase profits and satisfy dealers. This is an example of ________. A) line filling B) social marketing C) market diversification D) negative brand equity E) person marketing

A

To enable customers to opt out of seeing particular ads, marketers use a(n) ________. This is added to behaviorally targeted online ads to tell consumers why they are seeing a particular ad. A) advertising option icon B) opt-in question C) X to close the ad D) survey E) questionnaire

A

To take advantage of a downward-sloping experience curve, a company must do all of the following EXCEPT ________. A) increase the product's price B) be able to sell the higher volume of product C) price its product lower D) increase its production output E) decrease its costs through experience gained

A

Tristan and Juliet, a newly married couple who intend to go to Egypt for their honeymoon, bought a Europe travel package on Jizo Inc., an online travel site. As they have never seen Europe or used the services of Jizo before, they were largely dependent on other customers' feedback and signals for service quality. Which of the following characteristics of service is highlighted in this instance? A) service intangibility B) service inseparability C) service variability D) service perishability E) service distinction

A

Under ________ pricing, different versions of the product are priced differently but not according to differences in their costs. A) product form B) optional product C) captive product D) by-product E) seasonal

A

Under ________, the market consists of many buyers and sellers trading in a uniform commodity. A) pure competition B) monopolistic competition C) oligopolistic competition D) a pure monopoly E) the dominant firm model

A

Underpriced products ________. A) produce less revenue than they would if they were priced at the level of perceived value B) sell poorly in the global marketplace C) produce more revenue than they would if they were priced at the level of perceived value D) mostly offer higher value than those with a high markup price E) are characterized by rapidly declining demand

A

What action do consumers continue to perform even though a majority are concerned with identify theft? A) shopping online B) searching for product information C) reading reviews from friends on Facebook D) sending and responding to e-mail messages E) watching videos

A

What are the two dimensions of product quality? A) consistency and level B) performance and conformance C) design and innovation D) conformance and style E) feature and design

A

When a company sets a high price for a new product with the intention of reducing the price in the future, it is using the ________ pricing strategy. A) market-skimming B) cost-plus C) market-segmentation D) market-penetration E) competitive

A

When companies set prices, the government and social concerns are ________ factors affecting pricing decisions. A) external B) internal C) economic D) cultural E) organizational

A

Which form of geographic pricing is a company using when it charges the same rate to ship a product anywhere in the United States? A) uniform-delivered pricing B) psychological pricing C) zone pricing D) FOB-origin pricing E) basing-point pricing

A

Which of the following companies uses captive product pricing? A) Photo Genie, which sells inexpensive cameras that run only on their own expensive batteries B) Go Zone, which launched a range of tablet models, each priced according to its features C) Penguin's Parlor, which offers customers a 20-percent discount on their birthdays D) Sportsprint, which prices sports equipment according to customer evaluations E) Burger Den, whose combo meals are priced lower than its individual components sold together

A

Which of the following is NOT true of public policies and pricing? A) Companies are free to charge whatever prices they wish. B) Federal, state, and local laws govern the rules of fair play in pricing. C) Deceptive pricing is not permitted. D) Companies must consider broader societal pricing concerns. E) Regulations exist to control predatory pricing.

A

Which of the following is a challenge of marketing through online social networks? A) Results are hard to measure. B) Users seldom have control over the online social networks. C) Most existing networks are already controlled by major corporations and therefore do not favor competitors. D) It is difficult to get the approval of the online advisory board to post an ad in a social network. E) Marketing via online social networks is expensive and time-consuming.

A

Which of the following is a disadvantage of using blogs as a marketing tool? A) The blogosphere is cluttered and difficult to control. B) Advertising on a blog is typically expensive and time consuming. C) Using blogs as a marketing tool offers minimum reach to a target audience. D) Blogs, when used as a marketing tool, have a low rank in Web directories and search engines. E) Blogs do not provide the kind of personalized approach that today's marketers are looking for.

A

Which of the following is a geographical pricing strategy? A) basing-point pricing B) segmented pricing C) dynamic pricing D) Internet pricing E) location-based pricing

A

Which of the following is a reason a consumer would follow a company's blog? A) The blog offers fresh insights or new ideas about the company or products. B) The blog provides the consumer with familiar information. C) The blog allows consumers to communicate with each other. D) A well-followed blog gives the company influence in the marketplace. E) Consumers know that companies want them to follow the blog postings.

A

Which of the following is an adverse effect of using promotional pricing? A) It makes shopping stressful if used by multiple stores simultaneously. B) It erodes the value of competing brands in the eyes of customers. C) It gives pricing secrets away to competitors. D) It creates "deal-immune" customers if used often. E) It delays the company's focus on short-term strategies.

A

Which of the following is an example of a convenience product? A) fast food B) diamond ring C) furniture D) life insurance E) refrigerator

A

Which of the following is true of product bundle pricing? A) It promotes the sale of products that consumers might not otherwise buy. B) It is used to set prices across an entire product range based on customer evaluations. C) It forces customers to buy product parts that are only compatible with the main product. D) It results in companies making fewer—though more profitable—sales. E) It involves pricing the main product low and setting high markups on the supplies.

A

Which of the following is true of product line pricing? A) The price steps take cost differences between products in the line into account. B) The pricing strategy cannot be used by companies in developed countries. C) The price steps do not account for the prices of similar products from competitors. D) The pricing strategy involves overpricing products so that they appeal to the elite. E) The customer's perception of the value of different features is considered irrelevant.

A

Which of the following is true of promotional pricing? A) It leads to 'deal-prone' customers who buy products only during sales. B) It fortifies the brand's image in the eyes of customers if relied upon extensively. C) It simplifies shopping for customers if used simultaneously by multiple stores. D) It makes balancing short-term sales incentives against long-term brand building unnecessary. E) It is extremely beneficial for the brand's profitability if practiced repeatedly.

A

Which of the following is true of value-based pricing? A) The targeted value and price drive decisions about what costs can be incurred and the resulting product design. B) Value-based pricing is mostly product driven. C) Value-based pricing involves setting prices based on the costs of producing, distributing, and selling the product plus a fair rate of return for its effort and risk. D) The marketer usually designs a product and marketing program and then sets the price. E) A company using value-based pricing designs what it considers to be a good product, adds up the costs of making the product, and sets a price that covers costs plus a target profit.

A

Which of the following is true with regard to pure competition? A) Under pure competition, no single buyer or seller has much effect on the going market price. B) In a purely competitive market, marketing research is of utmost importance. C) In a purely competitive market, product development is the focus of most firms. D) Under pure competition, the market consists of many buyers and sellers who trade over a range of prices rather than a single market price. E) Under pure competition, the market consists of only a few large sellers.

A

Which of the following price adjustment strategies offers a price reduction to buyers who pay their bills promptly? A) cash discount B) season discount C) quantity discount D) trade discount E) functional discount

A

Which of the following shows the number of units the market will buy in a given time period, at different prices that might be charged? A) demand curve B) supply curve C) learning curve D) break-even pricing E) target costing

A

Which of the following strategies involves weeding out weaker brands and focusing marketing dollars only on brands that can achieve the number one or number two market share positions with good growth prospects in their categories? A) megabrand strategies B) niche marketing strategies C) social marketing strategies D) co-branding E) licensing

A

Which term refers to an in-store machine that allows a customer to order merchandise not carried in the store? A) kiosk B) automated teller machine C) virtual catalog D) interactive TV E) direct-response device

A

While comparing hotel rates on Google's search engine, Brenda came across text-based ads and links alongside the search results. This form of advertising is known as ________. A) contextual advertising B) rich media ads C) content sponsorship D) catalog advertising E) social media advertising

A

With accumulated production experience and a higher volume of production, companies not only become more efficient but also ________. A) gain economies of scale B) incur higher overhead costs C) create derived demand in the market D) spend more per unit of produced output E) tend to routinely spend less on inputs

A

With direct marketing, companies can interact with customers in all of the following ways EXCEPT ________. A) in person B) learning more about customers' needs C) personalizing products and services D) answering questions from customers E) by phone or online

A

________ allowances are payments or price reductions that reward dealers for participating in advertising and sales support programs. A) Promotional B) Trade-in C) Segmented D) Functional E) Dynamic

A

________ are less frequently purchased consumer products and services that customers compare carefully on suitability, quality, price, and style. A) Shopping products B) Convenience products C) Unsought products D) Capital items E) Supplies and repair services

A

________ involves designing and producing the container or wrapper for a product. A) Packaging B) Patenting C) Servicing D) Co-branding E) Labeling

A

________ is the only element in the marketing mix that produces revenue. A) Price B) Product C) Place D) Fixed costs E) Variable costs

A

________ means that service quality depends on the quality of buyer-seller interaction during the service encounter. A) Interactive marketing B) Service differentiation C) Service productivity D) Corporate image marketing E) Traditional external marketing

A

________ occurs when a company introduces additional items in a given product category under the same brand name, such as new flavors, forms, colors, ingredients, or package sizes. A) Line extension B) Megabranding C) Interactive marketing D) Internal marketing E) Co-branding

A

________ pricing involves charging higher prices on an everyday basis but running frequent promotions to lower prices temporarily on selected items. A) High-low B) Everyday low C) Cost-plus D) Break-even E) Penetration

A

________ pricing uses buyers' perceptions of value as the key to pricing. A) Customer value-based B) Cost-based C) Time-based D) Markup E) Target return

A

________ refers to a measure of the sensitivity of demand to changes in price. A) Price elasticity B) A demand curve C) Price-value equation D) Marginal utility E) Income elasticity of demand

A

A ________ is a name, term, sign, symbol, design, or a combination of these, that identifies the maker or seller of a product or service. A) feature B) brand C) line extension D) package E) value chain

B

A ________ is an unsolicited, unwanted commercial e-mail message that clogs up e-mailboxes. A) catalog B) spam C) podcast D) tweet E) blog

B

A company faces fixed costs of $100,000 and variable costs of $8 per unit. It plans to directly sell its product in the market for $12. How many units must it produce and sell to break even? A) 20,000 B) 25,000 C) 30,000 D) 35,000 E) 40,000

B

A manufacturer has fixed costs of $100,000, a variable cost of $10 per unit of output, and break-even volume of 50,000 units. What should the manufacturer's unit cost be in order to break even? A) $10 B) $12 C) $14 D) $16 E) $20

B

A quantity discount is a price reduction for buyers who ________. A) buy merchandise out of season B) buy merchandise in bulk C) pay their bills on time D) buy discontinued products E) return old items while buying new ones

B

Alex Smith rents storage space to college students who go home for the summer but do not want to haul all of their property home and back. The business is profitable during the summer months, but when the storage space is unoccupied in the off-season, Alex loses money. Which of the following characteristics of service is most likely the source of Alex's problem? A) intangibility B) perishability C) inconsistency D) variability E) inseparability

B

All of the following are forms of traditional direct marketing EXCEPT ________. A) face-to-face selling B) point-of-purchase promotion C) telemarketing D) direct-mail marketing E) kiosk marketing

B

An increasing number of retailers and wholesalers have created their own ________, also called store brands. A) national brand B) support brand C) private brand D) generic brand E) manufacturer's brand

B

Apollo Couriers, a company providing international express mail services, has a proactive customer communications team. The primary job of this team is to identify situations that led to customer dissatisfaction, and then provide quick remedies to fix the problems. To a great extent, this has helped Apollo in winning customer loyalty. In this instance, Apollo has benefitted from ________. A) product differentiation B) good service recovery C) multibranding D) place marketing E) co-branding

B

As a manufacturer increases the price, ________. A) efficiency drops B) the break-even volume drops C) competition is minimized D) the total costs increase E) the profit margin shrinks

B

As production workers become better organized and more familiar with equipment, the average cost per unit tends to decrease with the ________. A) increase in the diseconomies of scale B) accumulated production experience C) decrease in the economies of scale D) increase in derived demand E) increase in primary demand

B

Azure Air, an airline company, offers attractive prices to customers with tighter budgets. A no-frills airline, it charges for all other additional services, such as baggage handling and in-flight refreshments. Which of the following best describes Azure Air's pricing method? A) target profit pricing B) good-value pricing C) cost-based pricing D) break-even pricing E) penetration pricing

B

Beach Heaven uses two-part pricing for its holiday resort charges. Because this is a service, the price is broken into a fixed fee for the room plus a(n) ________ usage rate for activities, including kite-sailing and child care A) fixed B) variable C) standard D) market E) optional

B

BlueFin canned tuna has higher sales than its unbranded rival, even though the unbranded tuna costs $0.45 less per can than BlueFin tuna. BlueFin most likely has ________. A) an aggressive brand personality B) high brand equity C) no brand commitment D) negative brand equity E) low brand relevance

B

By using ________ to contact potential customers, marketers sell directly to consumers. A) undercover marketing B) outbound telephone marketing C) affinity marketing D) multi-level marketing E) ambush marketing

B

Charlie Putnam received an e-mail promoting a new financial services institution that offers surprisingly low mortgage rates. The e-mail simply asked customers to provide their address, date of birth, social security number, and current mortgage information in order to receive a free loan quote. Suspicious of the offer, Charlie researched the company and discovered that the e-mail was a fraud. This is an example of ________. A) cyberbullying B) phishing C) adware D) spamdexing E) viral marketing

B

Companies must attract visitors to their Web sites. Which of the following is a method companies use to entice visitors not just to visit but also to return to a site? A) using flashy graphics, bright colors and vivid pictures B) aggressively promoting the site in broadcast advertising and through ads and links on other sites C) offering prizes for visiting the site D) providing rewards for visitors connecting their friends to the site E) requiring registration on the first visit to the site

B

Companies set not a single price, but a pricing ________ that covers different items in its line and changes over time as products move through their life cycles. A) by-product B) structure C) loop D) cycle E) bundle

B

Companies that set a low price for a new product in order to attract a large number of buyers and a large market share are using the ________ strategy. A) market-skimming pricing B) market-penetration pricing C) cost-plus pricing D) inclusive pricing E) exclusive pricing

B

Companies with higher costs ________. A) can drive out competitors through their pricing strategy B) intentionally pay higher costs so that they can add value through higher quality and claim higher prices and margins C) can set lower prices that result in increased sales though with lower margins D) specialize in selling products without value-added features E) are more financially successful

B

Competitors are most likely to react to a price change when ________. A) a large number of competitors are involved B) the product is uniform C) the buyers are not well informed about product features D) buyers are not well informed about price differences E) the products are not uniform

B

Consumer products refer to ________. A) products purchased by consumers for further processing or for use in conducting a business B) products and services bought by final consumers for personal consumption C) primarily intangible offerings from marketers D) raw materials as well as manufactured materials and parts E) products that aid in the consumer's production or operations, including installations and accessory equipment

B

Dips in the economy and the instant price comparisons made possible by the Internet have contributed to ________. A) decreased consumer price sensitivity B) increased consumer price sensitivity C) a less direct relationship between supply and demand D) low brand equity for luxury goods E) decreased brand loyalty

B

Failure to enter the current price into a retailer's system may result in charges of ________. A) predatory pricing B) scanner fraud C) retail maintenance pricing D) discriminatory pricing E) price fixing

B

Federal legislation on price fixing requires that sellers set their prices ________. A) based on their fixed and variable costs B) without communication from competitors C) to achieve a specific profit margin D) without the intention of cutting into competitors' profits E) consistently throughout a region

B

Herbie Inc., a firm manufacturing sandwich makers, has fixed costs of $250,000, variable costs of $20 per unit of output, and expected unit sales of 50,000 units. What is the unit cost of a sandwich maker manufactured by Herbie? A) $15 B) $25 C) $30 D) $50 E) $75

B

If a service employee provides the service, then the employee becomes a part of the service. This is an example of service ________. A) intangibility B) inseparability C) variability D) perishability E) heterogeneity

B

If demand hardly changes with a small change in price, the demand is ________. A) variable B) inelastic C) highly elastic D) derived E) negative

B

In a bid to attract more customers in a market that has several competitors, Barrymore's Bakery slashed the prices of all its products by 50 percent. Managers at the firm reasoned that lower prices would draw in even more customers, making up for the reduction in price several times over. Which of the following pricing strategies are they using? A) market-skimming pricing B) market-penetration pricing C) captive-product pricing D) cash discount pricing E) by-product pricing

B

In building a connection to customers through catalogs, marketers want to ________. A) offer a new brand experience B) inspire and engage C) create word-of-mouth advertising D) develop a viral following E) perform marketing research

B

In industrial markets, ________ typically has the final say in setting the pricing objectives and policies of a company. A) the sales manager B) top management C) the production manager D) the HR department E) the sales staff

B

Lawyers, accountants, and other professionals typically price by adding a standard markup for profit. This exemplifies ________. A) target pricing B) cost-plus pricing C) value-based pricing D) break-even pricing E) penetration pricing

B

Low-interest financing and longer warranties are both examples of ________ pricing. A) segmented B) promotional C) product bundling D) captive product E) product form

B

Marbles Inc. has placed vending machines in most of its retail stores in Florida. Consumers can order a pack of marbles by just selecting their requirements on the touch screen. Which term best describes such machines? A) POP B) kiosk C) virtual catalog D) interactive television E) automated teller machine

B

Mark's Markers, a manufacturer of white board markers, has required its dealers to charge a specified retail price for its markers. Mark's is most likely guilty of ________. A) captive pricing B) retail price maintenance C) price discrimination D) competitive pricing E) unfair price skimming

B

Midnight Magic, a perfume manufacturing company, plans to release a new fragrance during the holiday season at $99 per bottle. The company intends to bring the price down to $49 within six months of its release to attract buyers who couldn't afford the initial price. Which of the following pricing strategies is Midnight Magic using? A) market-penetration pricing B) market-skimming pricing C) competitive pricing D) cost-plus pricing E) product-line pricing

B

Motorzone offers replacement parts for old Volkswagen Beetles. The company calculates shipping charges based on shipping parts from Boston, even though some parts actually ship from St. Louis. Motorzone most likely practices ________ pricing. A) FOB-origin B) basing-point C) zone D) uniform-delivered E) freight-absorption

B

Multiprint, a printer manufacturing firm, sells ink cartridges for each of its specific models. Only Multiprint cartridges are compatible with Multiprint printers, and no two models share the same specifications. What type of pricing does Multiprint use? A) product line pricing B) captive product pricing C) optional product pricing D) by-product pricing E) product bundle pricing

B

Online ads that incorporate animation, video, sound, and interactivity are called ________. A) search-related ads B) rich media ads C) content-based ads D) digital catalogs E) parody ads

B

Price is important to managers ________. A) because prices cannot be changed quickly, so must be correctly determined B) because a small percentage improvement in price can generate a large percentage increase in profitability C) but other marketing mix elements create customer value and build relationships D) but product features can be changed more quickly E) but has little impact on a firm's market share

B

Product mix ________ refers to the number of versions offered for each product in the line. A) length B) depth C) height D) width E) consistency

B

Product planners need to consider products and services on three levels. At the third level, product planners must build ________. A) an actual product B) an augmented product C) core customer value D) a brand personality E) a basic product

B

Public health campaigns designed to reduce alcoholism, drug abuse, smoking, and obesity are all examples of ________ marketing. A) internal B) social C) organization D) person E) place

B

Retailers such as Costco and Walmart charge a constant, daily low price with few or no temporary price discounts. This is an example of ________ pricing. A) competition-based B) everyday low C) cost-plus D) break-even E) penetration

B

Costco's Kirkland Signature products are an example of a ________. A) national brand B) support brand C) private brand D) generic brand E) manufacturer's brand

C

Segmented pricing is only effective when ________. A) the segments show similar degrees of demand B) the cost of segmenting does not exceed the revenue obtained from the price difference C) the segmented prices do not reflect real differences in customers' perceived value D) the customers of different socio-economic classes are treated according to their rank E) companies make their services and products accessible exclusively to wealthy patrons

B

Service ________ means that services cannot be stored for later sale or use. A) consistency B) perishability C) variability D) intangibility E) inseparability

B

Style simply describes the ________ of a product. A) quality B) appearance C) utility D) durability E) long-term benefits

B

Symmonds Inc., a company manufacturing breakfast cereals, has extended its special Crispo cereal brand into a full line of breakfast cereals plus protein shakes, fruit and sandwich spreads, butter, and doughnuts. This is an example of ________. A) line extension B) brand extension C) licensing D) co-branding E) cannibalization

B

Target return pricing is a variation of which of the following cost-oriented pricing approaches? A) cost-plus pricing B) break-even pricing C) markup pricing D) value-based pricing E) fixed cost pricing

B

Target return pricing uses the concept of a(n) ________, which shows the total cost and total revenue expected at different sales volume levels. A) BCG matrix B) break-even chart C) SWOT analysis D) demand curve E) experience curve

B

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

B

The ________ requires sellers to provide detailed nutritional information on food products. A) Fair Packaging and Labeling Act of 1966 B) Nutritional Labeling and Educational Act of 1990 C) Glass-Steagall Act D) Commodity Futures Modernization Act of 2000 E) Federal Trade Commission Act of 1914

B

The ________ seeks to prevent unfair price discrimination by ensuring that sellers offer the same price terms to customers at a given price level. A) FTC's "Guides against Deceptive Pricing" B) Robinson-Patman Act C) Sherman Act D) Clayton Act E) Automobile Information Disclosure Act

B

The advertising slogan, "We bring good things to life," used by General Electric to market itself, is an example of ________ marketing. A) person B) corporate image C) internal D) place E) niche

B

The discount offered by Glamor Gifts to customers who bought Valentine-themed merchandise the week following Valentine's Day is an example of a ________. A) functional discount B) seasonal discount C) trade discount D) cash discount E) time-based discount

B

The experience curve reveals that ________. A) repetition in production has no visible impact on production costs B) repetition in production enhances efficiency C) the average cost of production remains the same with accumulated production experience D) repetition in production adds to the costs and thereby increases the prices of outputs E) the average cost of production increases with accumulated production experience

B

The fundamental asset underlying brand equity is ________, the value of customer relationships that the brand creates. A) the customer mix B) customer equity C) the product experience D) service variability E) the service encounter

B

The learning curve is representative of the ________. A) per unit cost of output in the long run B) drop in the average per-unit production cost that comes with accumulated production experience C) number of units the market will buy in a given time period, at different prices that might be charged D) total market demand resulting from different prices E) per unit cost of output in the short run

B

The total production costs at Kellner Machine Works are $87,000 out of which $45,000 represent fixed costs. Which of the following is representative of the variable costs incurred by the company? A) $35,000 B) $42,000 C) $45,000 D) $87,000 E) $132,000

B

To decrease direct marketing abuses, government agencies are investigating do-not-call lists, do-not-mail lists, do-not-track-online lists, and ________. A) claimed fraudulent credit card charges B) Can Spam legislation C) possibly deceptive television advertising D) offerings of illegal products E) bait-and-switch offers

B

Trade-in allowances are most commonly used in the ________ industry. A) real estate B) automobile C) dairy products D) financial services E) health care

B

Under ________, the market consists of many buyers and sellers who trade over a range of prices rather than a single market price. A) pure competition B) monopolistic competition C) oligopolistic competition D) a pure monopoly E) the dominant firm model

B

Uptown-Clean Crew is a company that provides house-cleaning services in major urban and suburban areas. Marketers at Uptown-Clean Crew developed a short, humorous video promoting the company's services and posted it online. Soon the video was a rage as customers who saw the video found it hilarious and they passed it on to their friends and colleagues calling it the "Uptown comedy." Which form of marketing is illustrated from this scenario? A) telemarketing B) viral marketing C) integrated marketing D) omni-channel marketing E) kiosk marketing

B

Using interactive TV can allow consumers to perform all the following tasks during a company's ad EXCEPT ________. A) see what other sizes or colors are available B) identify a nearby location at which the product is available C) access additional product information D) order the product E) send product information to another device

B

What sets the floor for product prices? A) consumer perceptions of the product's value B) product costs C) competitors' strategies D) advertising budgets E) market competition

B

When theaters vary seat prices due to audience preferences for seats in coveted rows, they use ________ pricing. A) customer-segment B) location-based C) time-based D) product line E) captive product

B

Which kind of social media networks are smaller communities likely to join or create? A) blog B) niche C) Internet D) video E) commercial

B

Which of the following actions is a restaurant owner most likely to take in order to reduce problems associated with service intangibility? A) increase entree prices after 6:00 p.m. B) provide clean tablecloths and fresh napkins for each new customer C) empower employees to handle customer complaints D) offer discounted prices for appetizers ordered during happy hour E) hold regular employee workshops focusing on customer service

B

Which of the following acts requires that Web site operators obtain parental consent before collecting personal information about children under the age of 13? A) Safe Children's Act of 2001 B) Children's Online Privacy Protection Act C) Children's Online Protection Act D) Adam Walsh Child Protection and Safety Act E) Children's Act for Responsible Employment

B

Which of the following companies uses product line pricing? A) Photo Genie, which sells inexpensive cameras that run only on their own expensive batteries B) Mobile Point, which launched a range of cell phone models, each priced according to its features C) Penguin's Parlor, which offers customers a 20-percent discount on their birthdays and certain holidays D) Green Thumb, which gives away free watering cans with the purchase of certain potted plants E) Panizza, whose combo meals are priced lower than the individual components sold together

B

Which of the following factors would most likely lead to a company initiating a price cut? A) over-demand B) weakened economy C) poor competition D) cost inflation E) weak price competition

B

Which of the following involves adjusting prices to account for the physical location of customers? A) location-based pricing B) geographical pricing C) domestic pricing D) interior pricing E) captive pricing

B

Which of the following involves introducing less-expensive versions of established, brand name products? A) markup pricing B) good-value pricing C) time-based pricing D) cost-based pricing E) target profit pricing

B

Which of the following is NOT a deception or fraud concern for Internet users and marketers? A) phishing B) viral marketing C) malware D) cyber spying E) spyware

B

Which of the following is a goods-and-services combination? A) a bicycle B) a milk shake at an ice cream store C) chocolate chips D) a train ride E) a music lesson

B

Which of the following is a major form of direct-response television marketing? A) telemarketing B) interactive TV C) social media D) digital catalog E) podcast

B

Which of the following is a price adjustment strategy that considers how a customer's perception of a product is influenced by its price? A) captive product pricing B) psychological pricing C) by-product pricing D) promotional pricing E) international pricing

B

Which of the following is an external factor that affects pricing decisions in a company? A) the company's overall marketing strategy B) the nature of the market C) the organizational objectives of the company D) elements of the company's marketing mix E) the annual advertising budget of rival firms

B

Which of the following is the fastest growing form of direct marketing? A) ambush marketing B) digital marketing C) direct-mail marketing D) kiosk marketing E) telemarketing

B

Which of the following is true of optional-product pricing? A) It involves capitalizing on low value by-products. B) It involves pricing products that can be added to the base product. C) It is used to price a company's main product. D) It involves setting geographically specific prices. E) It is used to price products that must be used with the company's main product.

B

Which of the following is true of price skimming? A) It is effective in situations in which competitors are able to undercut prices easily. B) It can be profitably used when the product's quality and image support its price. C) It involves underpricing products so that companies make larger sales. D) It is ineffective in situations in which competitors are unable to enter the market easily. E) It leads to a situation in which the company completes more, though less profitable, sales

B

Which of the following is true of public policies and pricing? A) The government imposes no limits on intrastate pricing issues. B) The Robinson-Patman Act governs interstate commerce. C) Companies have free rein when it comes to setting prices. D) The Sherman Act governs intrastate commerce. E) The Clayton Act encourages the formation of monopolies

B

Which of the following is true with regard to brand equity? A) Brand equity refers to how much consumers know about the brand. B) High brand equity provides a company with many competitive advantages. C) A brand has positive brand equity if consumers react less favorably to it than to an unbranded version. D) Positive brand equity derives from low brand esteem. E) The total financial value of a brand can be easily measured.

B

Which of the following is true with regard to services? A) Services refer to purely tangible products. B) Services are a form of product that consists of activities, benefits, or satisfactions offered for sale. C) Services can be stored for later use. D) Services can be easily separated from their providers. E) Services are tangible product offerings whose quality can be easily measured.

B

Which of the following is true with regard to value-added pricing? A) Companies that practice value-added pricing typically match the competition by cutting prices. B) Companies practicing value-added pricing differentiate their offers by attaching value-added features to offerings that, in turn, justify higher prices. C) The intrinsic value of products sold by companies practicing value-added pricing is far less than their actual selling price. D) Companies practicing value-added pricing primarily rely on cost differentiation. E) Value-added pricing is the most suitable pricing strategy in pure monopolies.

B

Which of the following likely does NOT play into products being offered for different prices in different countries? A) additional costs of operations B) product commonality C) physical distribution D) shipping and insurance E) exchange-rate fluctuations

B

Which of the following product mix pricing strategies involves pricing multiple products to be sold together? A) product line pricing B) product bundle pricing C) optional product pricing D) by-product pricing E) captive product pricing

B

Which of the following types of marketing involves sending out letters, brochures, samples, and DVDs to consumers' addresses? A) direct-response marketing B) direct-mail marketing C) direct digital marketing D) kiosk marketing E) online marketing

B

Which of the following would be considered predatory pricing? A) a company that prices its products below cost to get rid of a surplus B) a company that prices below cost to drive out competitors C) a company that offers a volume discount D) a company that offers the suggested retail price on the manufacturer's package E) a company that offers real-time pricing online

B

Which term best describes sites such as the New York Times on the Web and ESPN.com? A) search engine B) content site C) online social network D) transaction site E) e-tailer

B

Which term refers to prices that buyers carry in their minds and check with when they look at a given product? A) product line prices B) reference prices C) location-based prices D) product form prices E) time-based prices

B

While blogs are a fundamentally a consumer-controlled medium, marketers can ________. A) directly contact customers through them B) use insights from them to improve their marketing programs C) offer special promotions to new customers D) retrieve research data from clicks in them E) provide content

B

Whizz Corp. wishes to introduce a new hybrid car into mature markets in developed countries with the goal of gaining mass-market share quickly. Which of the following pricing strategies would help the firm meet its goal? A) market-skimming pricing B) market-penetration pricing C) market-segmentation pricing D) cost-plus pricing E) captive-product pricing

B

Why does direct-mail marketing most likely remain a popular promotional tool for marketers? A) It does not disturb consumers enrolled in the Do Not Call Registry. B) It provides something tangible for people to keep. C) It builds long-term customer relationships. D) It involves very low marketing costs. E) It reaches the consumer very quickly.

B

With which pricing strategy does the seller take responsibility for part or all of the actual freight charges in order to acquire the desired business? A) FOB origin pricing B) freight-absorption pricing C) basing-point pricing D) location-based pricing E) uniform-delivered pricing

B

________ allowances are price reductions given for turning in an old item when buying a new one. A) Promotional B) Trade-in C) Depreciation D) Segmented E) Functional

B

________ are a form of product that consists of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in the ownership of anything. A) Liabilities B) Services C) Brands D) Consumer products E) Specialty products

B

________ are designed to engage consumers in interactions that will move them closer to a direct purchase or other marketing outcome. A) Online magazines B) Marketing Web sites C) Search engines D) Digital catalogs E) Podcasts

B

________ are online journals where people post their thoughts, usually on a narrowly defined topic. A) Social networks B) Blogs C) Forums D) Search engines E) Web directories

B

________ are the major marketing factors in the sale of most manufactured materials and parts. A) Branding and advertising B) Price and service C) Sales promotion and advertising D) Branding and packaging E) Public relations and brand management

B

________ contributes to a product's usefulness as well as to its looks. A) Sensational style B) Good design C) Quality D) Consistency E) Packaging

B

________ is a pricing strategy in which the company sets up two or more clearly identified geographic regions within which all customers pay the same total price. A) Freight-absorption pricing B) Zone pricing C) Uniform-delivered pricing D) FOB-origin pricing E) Basing-point pricing

B

________ marketing consists of activities undertaken to create, maintain, or change attitudes toward particular people. People ranging from presidents, entertainers, and sports figures to professionals such as doctors, lawyers, and architects use it to build their reputations. A) Corporate image B) Person C) Social D) Organization E) Place

B

________ marketing consists of activities undertaken to create, maintain, or change the attitudes and behaviors of target consumers toward an organization. A) Social network B) Organization C) Niche D) Location E) Concentrated

B

________ marketing involves activities undertaken to create, maintain, or change attitudes toward particular cities, states, or regions. A) Idea B) Place C) Organization D) Social E) Interactive

B

________ occurs when a company lengthens its product line beyond its current range. A) Product line filling B) Product line stretching C) Co-branding D) Niche marketing E) Market diversification

B

________ pricing refers to offering just the right combination of quality and gratifying service at a fair price. A) Markup B) Good-value C) Cost-plus D) Target profit E) Break-even

B

________ refers to the characteristics of a product or service that bear on its ability to satisfy stated or implied customer needs. A) Brand equity B) Product quality C) Product labeling D) Brand image E) Brand personality

B

17) Which of the following processes does value-based pricing reverse? A) high-low pricing B) everyday low pricing C) cost-based pricing D) good-value pricing E) value-added pricing

C

A downward-sloping experience curve is indicative of ________. A) the negative customer perception about a company's products B) the falling demand for a company's products C) the falling unit production cost of a company D) the low quality of a company's products E) slow and inadequate organizational learning

C

A lumber mill takes in logs, turns them into 2 x 4's and other sizes needed for building construction. Wood chips created in the milling process are a(n) ________ that can be sold. A) bundled product B) captive product C) by-product D) optional product E) primary product

C

A market-penetration pricing policy should LEAST likely be used for a new product when ________. A) the market is highly price sensitive B) production and distribution costs fall as sales volume increases C) the product's quality and image support a high price D) a high price helps keep out the competition E) there are few or no competitors in the market

C

A product's ________ identifies the product or brand, describes several things about the product, and promotes the brand. A) line extension B) portfolio C) label D) design E) feature

C

A restaurant wants to use value-based pricing. It knows the costs of the ingredients in the food. It must also factor in ________ in determining customer satisfaction and value. A) wages of employees B) costs of utilities of the restaurant C) atmosphere and décor of the restaurant D) travel distance for customers E) percentage of bar patrons versus dining patrons

C

A well-known cosmetic company in New York City added new product lines in order to increase its business. In other words, it ________. A) lengthened its existing product line B) decreased its product line consistency C) widened its product mix D) engaged in market diversification E) engaged in social marketing

C

A(n) ________ is a straight reduction in price on purchases during a stated period of time or of larger quantities. A) allowance B) free sample C) discount D) tax credit E) quota

C

Advertising campaigns involving issues ranging from health care, education, and environmental sustainability to human rights and personal safety can be classified under ________ marketing. A) corporate image B) internal C) social D) place E) person

C

After a brief stay at a luxury hotel in Paris, Benjamin Sanders noted that the hotel had kept every promise it made when he booked the room, meeting all his needs. He added that it was a "thoroughly comfortable and opulent experience." According to Young & Rubicam's Brand Asset Valuator, this reflects brand ________. A) valuation B) esteem C) relevance D) differentiation E) knowledge

C

All of the following are benefits of direct marketing for sellers EXCEPT ________. A) access to small groups or individuals B) program flexibility C) mass reach and immediate returns D) low cost E) easy to personalize products

C

All of the following are benefits of online direct marketing for buyers EXCEPT ________. A) access to numerous products B) access to product reviews C) live product demonstrations D) convenience E) privacy

C

As production moves up, the average cost per unit decreases because ________. A) variable costs decrease B) of increasing diseconomies of scale C) fixed costs are spread over more units D) overhead costs decrease E) revenue increases

C

Big Mike's Health Food Store sells nutritional energy foods. The price of the products sold varies according to individual customer accounts and situations. For example, long-time customers receive discounts. This strategy is an example of ________. A) time-based pricing B) seasonal pricing C) dynamic pricing D) promotional pricing E) penetration pricing

C

Brand ________ is the differential effect that knowing the brand name has on customer response to the product and its marketing. A) differentiation B) knowledge C) equity D) personality E) relevance

C

Bruno Servers has decided to decrease its prices on its popular higher-range servers. The company can reasonably expect ________ to increase. A) fixed costs B) variable costs C) demand D) additional value E) overhead costs

C

Buyers with low sales resistance can often be tempted by all the following common features of infomercials EXCEPT ________. A) elaborately staged demonstrations B) "while they last" time limitations C) free shipping D) smooth-talking hosts E) claims of drastic price reductions

C

Companies facing the challenge of setting prices for the first time can choose between two broad strategies: market-penetration pricing and ________ pricing. A) comparative B) competitive C) market-skimming D) market-segmentation E) cost-plus

C

Companies that adopt value-added pricing ________. A) consider value-added features as a fitting substitute for aggressive cost cutting B) set incredibly low prices to meet competition C) attach value-added features and services to differentiate their offers and support their higher prices D) overprice their products without any apparent justification E) underprice their products and lower quality to boost demand in the short-run

C

Companies with lower costs ________. A) specialize in selling products with value-added features B) usually market products with inferior quality, thereby justifying the low selling price C) can set lower prices that result in smaller margins but greater sales and profits D) tend to overprice products owing to their monopolistic advantage E) usually set higher prices that result in higher margins

C

Consumers are less likely to use price to judge the quality of a product when they ________. A) have never tried the product before B) have little knowledge of the brand C) have experience with the product D) are shopping for luxury items E) cannot physically examine the product

C

Cost-plus pricing ________. A) is a complex pricing method B) involves pricing that accurately reflects production costs C) involves adding a standard markup for profit D) aims at breaking even on the costs of making and marketing a product E) is a value-based pricing method

C

________ refers to the amount of money charged for a product or service. A) Value B) Cost C) Price D) Wage E) Salary

C

DivetheBlue, a company marketing deep-sea diving equipment, charges very high prices for its products. Despite the availability of many low-priced products in the market, customers seem to prefer DivetheBlue, which has earned a reputation for selling high-quality products. This exemplifies ________. A) a pure monopoly B) an oligopoly C) a nonprice position D) break-even pricing E) target costing

C

Donello Equipment hosts infomercials on television and at the same time allows its viewers to interact with its advertisements. Viewers can request more details and order via their Internet-ready smart televisions. Which of the following forms of marketing is evident here? A) catalog marketing B) telemarketing C) interactive television D) podcast marketing E) kiosk marketing

C

Electrowhip, a company that manufacturers blenders and electric whisks, has decided to use a market penetration pricing strategy. Which of the following, if true, proves their decision to be a wise one? A) Electrowhip's competitors utilize social media for marketing their products. B) Electrowhip sells products whose image and quality support high prices. C) Electrowhip operates in a market with many competitors. D) Electrowhip does not operate in a price sensitive market. E) Electrowhip's products are intended to appeal to the elite in society.

C

Elmo Inc., a global conglomerate, designed the ElBrush, an electric toothbrush. Sensing market demand for the electric toothbrush, Elmo started with an ideal selling price of $13 based on customer value considerations and then targeted costs to ensure that the price was met. This exemplifies ________. A) competition-based pricing B) cost-plus pricing C) target costing D) everyday low pricing E) high-low pricing

C

Features are a competitive tool for differentiating a company's product from competitors' products. Which question are companies LEAST likely to ask in a survey of buyers regarding product features? A) Which features could we add to improve the product? B) Which specific features of the product do you like most? C) How much would (a certain new feature) be worth to you? D) Which features of the product do you like the least? E) How do you like the product?

C

Freight-absorption pricing is used for ________. A) penetrating international markets B) generating customer buzz about new products C) holding on to increasingly competitive markets D) generating quick profits to offset input costs E) maintaining quality service records

C

If Detroit DLX charges the same price for the delivery of its product to customers located in the states near the Great Lakes, but a different price to customers elsewhere, the company is using ________. A) psychological pricing B) promotional pricing C) zone pricing D) reference pricing E) uniform-delivered pricing

C

If a large retailer sold numerous items below cost with the intention of punishing small competitors and gaining higher long-run profits by putting those competitors out of business, the retailer would be guilty of ________. A) price collusion B) price fixing C) predatory pricing D) competitive pricing E) penetration pricing

C

In 2011, the fixed costs of a company were $500,000, and its variable costs equaled $150,000. In 2010, the company made an annual profit of $200,000. It has been predicted that, despite a steady growth, the company's variable costs will likely equal $300,000 by 2013. The total costs of the company in 2011 were ________. A) $350,000 B) $450,000 C) $650,000 D) $800,000 E) $950,000

C

In the case of services, captive product pricing is called ________ pricing. A) by-product B) optional product C) two-part D) bundle E) segmented

C

Installations consist of ________. A) highly priced luxury goods such as Rolex watches B) portable office equipment such as computers C) major purchases such as elevators D) portable factory equipment such as hand tools E) products such as insurance

C

Joanna uses her smartphone to accomplish many tasks everyday. She is also an avid shopper. Which online marketing tool will benefit Joanna the most to help her shop? A) e-mail messages from sites to which she subscribes B) banking app for her bank C) instant deals and digital coupons D) YouTube video E) Facebook friends

C

Leicestershire Renovations has a history of problems with customers who do not pay their bills on time. Leicestershire Renovations wants to improve its cash situation, reduce bad debts, and reduce credit-collection costs. Which of the following forms of pricing would most likely help the firm achieve its goal? A) by-product pricing B) zone pricing C) cash discounts D) product bundling E) quantity discounts

C

Market offering includes everything from pure tangible goods to pure services, as well as combinations of goods and services. Which of the following is NOT a product or service? A) breakfast cereal B) rental car C) free concert D) shoes E) haircut

C

Mobile marketing is used to enrich the brand experience, stimulate immediate buying, or ________. A) decrease advertising costs B) help friends contact friends C) make shopping easier D) create new customer relationships E) find new suppliers

C

Price discrimination is legal when a ________. A) manufacturer and reseller have agreed upon a specified retail price for a product B) manufacturer sells to retailers in different markets C) seller can prove its costs are different when selling to different retailers D) seller advertises prices that are not actually available to consumers E) seller has not communicated with competitors before announcing prices

C

Price setting is usually determined by ________ in large companies. A) top managers B) external stakeholders C) product managers D) non-executive employees E) the sales department

C

Product attributes include all of the following EXCEPT ________. A) style B) design C) price D) features E) quality

C

Product mix ________ refers to the number of different product lines the company carries. A) length B) height C) width D) consistency E) depth

C

Product planners need to consider products and services on three levels. At the second level, product planners must ________. A) offer additional product support and after-sale services B) identify the core customer value that consumers seek from the product C) turn the core benefit into an actual product D) find out how they can create the most satisfying brand experience E) define the problem-solving benefits or services that consumers seek

C

Product planners need to consider products and services on three levels. Each level adds more customer value. The most basic level is ________, which addresses the question, "What is the buyer really buying?" A) an actual product B) an augmented product C) core customer value D) co-branding E) exchange value

C

Proton Corp. is an automobile manufacturer known for producing efficient, durable, and low-priced cars. Recently, the company launched a new range of luxury cars to broaden its market appeal and to add prestige to its existing line of cars. This is an example of ________. A) social marketing B) product line filling C) product line stretching D) internal marketing E) cannibalization

C

Rhodia invites tourists from all over the world to experience its pristine nature, clear skies, and beautiful summertime climate. This exemplifies ________. A) corporate image marketing B) social marketing C) place marketing D) social engineering E) negative brand equity

C

Runners can compare performances, set up profiles, meet new people, and share information on Nike's Nike+ Web site. Nike+ is an example of a(n) ________. A) podcast B) blog C) online community D) content sponsorship program E) kiosk

C

Service ________ means that services cannot be seen, tasted, felt, heard, or smelled before they are bought. A) inseparability B) variability C) intangibility D) perishability E) heterogeneity

C

Service ________ means that the quality of services depends on who provides them as well as when, where, and how they are provided. A) intangibility B) inseparability C) variability D) perishability E) heterogeneity

C

TRUSTe, a nonprofit self-regulatory organization, works with other companies to audit online privacy and security measures. It lends its TRUSTe privacy seal to all the following communication channels that meet its privacy and security standards EXCEPT ________. A) mobile apps B) e-mail marketing C) telemarketing D) Web sites E) social media

C

The New Age Gallery has three admission prices for students, adults, and seniors, even though all three groups are entitled to the same services. This form of pricing is called ________ pricing. A) psychological B) product form C) customer-segment D) captive product E) by-product

C

The ________ of the product mix refers to how closely related the various product lines are in end use, production requirements, distribution channels, or some other way. A) length B) depth C) consistency D) width E) height

C

The first step in designing support services is to ________. A) add new services that will both delight customers and yield profits to the company B) closely observe the product and pricing strategies of consumers C) survey customers to assess the value of current services and obtain ideas for new ones D) prevent brand dilution E) encourage customers to try new products

C

The fixed cost in manufacturing a single LED monitor is $40 and the variable cost is $12. If the company expects to manufacture 5,000 monitors, the total costs would be ________. A) $60,000 B) $200,000 C) $260,000 D) $420,000 E) $500,000

C

The movie industry in a country is controlled by six large studios that receive 90 percent of the annual revenues from movies. This is an example of a(n) ________. A) pure competition B) monopolistic competition C) oligopolistic competition D) pure monopoly E) government monopoly

C

The perceived value of different product offers can be reasonably assessed by ________. A) conducting a SWOT analysis B) preparing demand curves C) conducting surveys and experiments D) collecting data about competitors' offers E) setting a benchmark for product quality

C

The service profit chain includes internal service quality, satisfied and productive service employees, greater service value, healthy service profits and growth, and ________. A) higher market share B) better paid employees C) satisfied and loyal customers D) increased manufacturing efficiency E) higher morale

C

The simplest pricing method is ________ pricing. A) value-based B) fixed cost C) cost-plus D) target return E) competition-based

C

Ways to avoid accusations of price gouging include ________. A) bundling products together B) matching competitors' pricing C) communications to customers explaining why prices are being increased D) passing along increased costs E) increase quality of the product

C

What is the primary advantage of printed catalogs? A) filtering out interested prospects B) offering immediate rebates and coupons C) building emotional connections with customers D) offering unlimited space for merchandise details E) reaching consumers in a quick and inexpensive manner

C

What sets the ceiling for product prices? A) product manufacturing costs B) sellers' perceptions of the product's value C) customer perceptions of the product's value D) variable costs E) break-even volume

C

When McDonald's and other fast food restaurants offer "value menu" items at surprisingly low prices, they are most likely using ________ pricing. A) break-even B) target profit C) good-value D) cost-plus E) target return

C

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

C

When faced with a competitor who has cut its product's price, which of the following is the most cost-effective way for a company to maintain its own price but raise the perceived value of its offer? A) by improving the quality of the product B) by introducing a higher-priced premium brand C) by altering the company's marketing communications D) by bundling the offer with add-ons E) by distributing the product through less costly channels

C

When performing a break-even analysis, the manufacturer should consider all of the following EXCEPT ________. A) probable demand B) likely profits C) competitors' pricing D) estimated break-even volumes E) different prices

C

When sellers set prices after talking to competitors and engaging in collusion, they are involved in ________. A) interstate commerce B) comparative pricing C) price fixing D) skimming pricing E) price bundling

C

Which of the following best describes permission-based e-mail marketing? A) sending unsolicited, unwanted commercial e-mail messages B) sending requests to users to join online social networking communities C) sending e-mail pitches only to customers who "opt-in" D) offering free promotional materials to new customers E) gathering demographic details for customer databases

C

Which of the following exemplifies a service? A) candy B) laptop C) hair salon D) car E) laundry detergent

C

Which of the following is NOT a reason that companies use social media? A) cost effectiveness B) engagement and social sharing capabilities C) ease of creating content D) immediacy and timeliness E) interactiveness

C

Which of the following is a cost-based approach to pricing? A) value-based pricing B) high-low pricing C) target return pricing D) good value pricing E) EDLP

C

Which of the following is an advantage of a well-designed and targeted telemarketing plan? A) exemption from the National Do Not Call Registry B) ability to portray wider merchandise C) purchasing convenience for customers D) interactive infomercials via phone E) coordination with nearby kiosks

C

Which of the following is an advantage offered by co-branding? A) Manufacturers do not have to invest in creating their own brand names with co-branding. B) Co-branding allows retailers to sell exclusive products that cannot be purchased from competitors. C) Co-branding allows a company to expand its existing brand into a category it might otherwise have difficulty entering alone. D) Co-branding dilutes brand equity and increases the appeal of store brands. E) Co-branding does not involve complex legal contracts and licenses.

C

Which of the following is an internal factor that affects pricing decisions in a company? A) the nature of the market B) the degree of inflation in the economy C) the overall marketing strategy of the company D) the forces of demand and supply in the market E) consumers' perception of value

C

Which of the following is most likely a disadvantage of viral marketing? A) Viral marketing usually takes time to make an impact. B) Viral marketing is very inexpensive. C) Marketers have great control over who receives the viral message. D) Viral marketing messages are offensive to the audiences who are not a part of the targeted market. E) Viral marketing messages are blocked by most search engines.

C

Which of the following is the lowest level on which marketers can position their brands in target customers' minds? A) beliefs and values B) product benefits C) product attributes D) after-sale services E) brand equity

C

Which of the following is true about e-mail marketing messages? A) E-mail marketing messages involve sending an offer, announcement, reminder, or sample to a person living at a particular address. B) E-mail marketing messages involve connecting directly with carefully targeted consumers, exclusively on a one-to-one, interactive basis. C) E-mail marketing messages are effective in reaching the desired target market and result in low costs. D) E-mail marketing messages cost more per thousand people reached than mass media such as television or magazines. E) E-mail marketing messages create a stronger emotional connection with the customers compared to traditional direct mail.

C

Which of the following is true about online direct marketing? A) Online direct marketing is also referred to as multi-level marketing. B) Salespersons are compensated for other salespeople they recruit. C) Online direct marketing allows sellers to create immediate, timely, and personal offers. D) Online direct marketing involves two or more intermediaries. E) In online direct marketing, outside and inside sales forces coordinate to provide value

C

________ represent(s) consumers' perceptions and feelings about a product and its performance. A) Product lines B) Labeling C) Brands D) Design E) Product attributes

C

Which of the following is true of market-penetration pricing? A) It should be used when the product's quality and image support a high price. B) It involves setting a high price for a new product to appeal to the elite in society. C) It results in drawing in large numbers of buyers quickly, winning a large market share. D) It is best used in conjunction with a market-skimming pricing strategy. E) It results in the company making fewer and less profitable sales

C

Which of the following is used in an attempt to dominate the market through a pricing strategy? A) price increase B) match competitors' pricing C) price cuts D) quantity discounts E) custom prices

C

Which of the following product mix pricing strategies involves pricing products that can only be used with the main product? A) by-product pricing B) product bundle pricing C) captive product pricing D) product line pricing E) optional product pricing

C

Which of the following statements is true of direct marketing? A) Direct marketing is also referred to as referral marketing. B) Salespersons are compensated for other salespeople they recruit. C) Direct marketing offers sellers a low-cost alternative for reaching their markets. D) Direct marketing involves two or more intermediaries. E) In direct marketing, consumers earn a commission every time they buy a product.

C

Which of the following statements is true of viral marketing? A) Marketers have significant control over where their viral messages end up. B) Viral marketing gives consumers online places to congregate, socialize, and exchange views. C) Because customers find and pass along the message, viral marketing can be very inexpensive. D) In viral marketing, links appear alongside search engine results on sites such as Google and Bing. E) Viral marketing messages are blocked by most search engines, security software, and social networking sites.

C

While advertising campaigns can help create name recognition, brand knowledge, and perhaps even some brand preference, brands are not maintained by advertising but by ________. A) brand differentiation B) line extensions C) brand experiences D) brand sponsorships E) brand awareness

C

________ are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort. A) Shopping products B) Unsought products C) Specialty products D) Capital items E) Convenience products

C

________ are consumer products that the consumer either does not know about or knows about but does not normally think about buying. A) Specialty products B) Convenience products C) Unsought products D) Shopping products E) Capital items

C

________ are formed by noting current prices, remembering past prices, or assessing the buying situation. A) Product line prices B) Seasonal prices C) Reference prices D) Time-based prices E) Product bundle prices

C

________ are industrial products that aid in the buyer's production or operations, including installations and accessory equipment. A) Unsought products B) Convenience products C) Capital items D) Specialty items E) Repair items

C

________ companies use both offline and online marketing channels. A) Start-up B) Click-only C) Omni-channel retailing D) Brick-and-mortar E) Brick-only

C

________ involves adding more items within the present range of the product line. A) Market diversification B) Brand extension C) Product line filling D) Upward product line stretching E) Downward product line stretching

C

________ involves setting prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for effort and risk. A) Value-based pricing B) Competition-based pricing C) Cost-based pricing D) Penetration pricing E) Break-even pricing

C

________ involves the use of a successful brand name for new or modified products in a new category. A) A line extension B) A product line C) A brand extension D) Co-branding E) Cannibalization

C

________ is an approach in which all the company's people are involved in constantly improving the quality of products, services, and business processes. A) Business intelligence B) Quality function deployment C) Total quality management D) Brand equity management E) Product positioning

C

________ occurs when a seller states price savings that are not actually available to consumers. A) Comparative pricing B) Scanner fraud C) Deceptive pricing D) Market skimming E) Price collusion

C

________ occurs when two established brand names of different companies are used on the same product. A) Market diversification B) Niche marketing C) Co-branding D) Licensing E) Cannibalization

C

16) What is usually the first step in cost-based pricing? A) testing the product concept with potential customers B) determining the marketing mix strategy C) setting a price that covers costs plus a target profit D) designing a good product E) adding up the costs of making the product

D

A company that uses well-known celebrities to help sell its products is using ________ marketing. A) interactive B) internal C) social D) person E) organization

D

A hickory rocking chair, handmade by an Amish woodcarver in Lancaster, Pennsylvania, from locally grown wood, is an example of a ________. A) convenience product B) capital item C) service D) specialty product E) product attribute

D

A market-skimming pricing strategy should NOT be used for a new product when ________. A) the product's quality and image support its higher price B) enough buyers want the products at that price C) competitors are unable to enter the market D) competitors can undercut prices easily E) producing a smaller number of goods is feasible

D

A pharmaceutical company in Utah recently released a new and expensive anti-ulcer drug in the market. The company justifies the high price of the drug by claiming that it is highly effective for treating all kinds of ulcers. The company also claims that the new drug will help bring down the need for invasive surgeries, an additional benefit for patients. Which of the following pricing strategies is the pharmaceutical company most likely using in this instance? A) target pricing B) markup pricing C) cost-based pricing D) value-based pricing E) break-even pricing

D

A supermarket places its store brand of blackberry jam priced at $5 per jar in the fruit preserves aisle, alongside the jam jars of a better known brand—whose products are priced at $8 apiece. Store managers reason that customers are more likely to choose the store brand instead of the better-known brand when they realize the price difference. What price adjustment strategy is evident in the supermarket's reasoning? A) by-product pricing B) product bundle pricing C) captive product pricing D) psychological pricing E) seasonal pricing

D

According to the service profit chain, superior internal service quality results in ________. A) lesser service value B) increased word-of-mouth sales C) reduced after-sale services D) more satisfied, loyal, and hardworking employees E) negative brand equity of newly launched products

D

Advantages of direct and digital marketing for sellers include all of the following EXCEPT ________. A) low cost B) efficiency C) speed D) need for sales training E) flexibility

D

An integrated social marketing campaign likely could include all of the following EXCEPT ________. A) Facebook pages B) Twitter postings C) Instagram photos D) television ads E) YouTube videos

D

Companies such as Amazon.com and Expedia.com that sell products and services directly to final buyers exclusively over the Internet are known as ________. A) transaction sites B) content sites C) search engines and portals D) e-tailers E) online social media

D

Consumers' names and additional information likely become part of ________ whenever they enter a sweepstakes, apply for a credit card, visit a Web site, or send a tweet. A) other consumers' contact lists B) telemarketers' lists C) their computer's cookie history D) a company's database E) the FTC's surveys regarding online privacy

D

Department stores such as Kohl's and JCPenney's practice high-low pricing by ________. A) charging a constant, everyday low price B) providing few or no temporary price discounts C) increasing prices temporarily on select products D) having frequent sale days for store credit-card holders E) underpricing most consumer items

D

Effective ________ pricing involves understanding how much value consumers place on the benefits they receive from the product and setting a price that captures that value. A) competition-oriented B) cost-based C) time-based D) customer-oriented E) marketer-oriented

D

Erica wants to replace her old washing machine with a new one. In order to get the maximum value for her money, she plans to spend substantial time and effort in gathering information and making product comparisons before making the actual purchase. In this instance, Erica is planning to buy a(n) ________ product. A) convenience B) unsought C) specialty D) shopping E) exclusive

D

Even large companies use infomercials for all the following reasons EXCEPT to ________. A) recruit members B) refer customers to retailers C) attract buyers to online, mobile, and social media sites D) introduce new advertising campaigns E) sell their products

D

Factors a company considers in setting its price include all of the following EXCEPT ________. A) competitors' strategies and prices B) product costs C) overall marketing strategy and mix D) value of the product on the pre-owned market E) nature of the market and demand

D

Geller Insurance calls qualified prospects to sell insurance. Which of the following forms of marketing is evident from this example? A) catalog marketing B) kiosk marketing C) direct-response television marketing D) telemarketing E) direct-mail marketing

D

If demand changes greatly with a small change in price, the demand is ________. A) variable B) inelastic C) derived D) elastic E) negative

D

In an effort to differentiate its offerings from its competitors, Pegasus Computers decided to add an extra USB port in all its laptops besides providing a free pair of Delphi power bass headphones with every Pegasus laptop. Although the additional features increased the price of the laptops by $500, Pegasus was confident that the strategy would help boost demand for its laptops substantially. This is an example of ________. A) good-value pricing B) markup pricing C) break-even pricing D) value-added pricing E) cost-based pricing

D

In response to price cuts from competitors, a cereal company with several more expensive and higher quality cereals introduced a lower-priced option to its product line. This is an example of which of the following responses to a competitor's price cut? A) raising the perceived value of a product B) improving product quality C) accepting a reduced market share D) launching a "fighter brand" E) using high-low pricing

D

In return for participating in Honda advertising and sales support programs, Honda dealerships are rewarded with payments or price reductions, which are known as ________. A) seasonal discounts B) functional allowances C) cash discounts D) promotional allowances E) trade-in allowances

D

Kirk's Comic Store has its own mobile app that users can download for free. The app lets users know about special events, discounts, and merchandise currently available in the store. Which of the following forms of marketing is exemplified from this scenario? A) social media marketing B) kiosk marketing C) direct-response television marketing D) mobile marketing E) direct-mail marketing

D

La Belle released a cut glass bottle of perfume at $299 per item, even though its major competitor prices its signature scent at $99 per item. La Belle reasons that customers in search of luxury goods will prefer its product because they are likelier to believe that high price indicates superior quality. What price adjustment strategy is evident in its reasoning? A) seasonal pricing B) time-based pricing C) captive product pricing D) psychological pricing E) location-based pricing

D

Online marketing includes marketing via the Internet using company Web sites, e-mail marketing, blogs, and ________. A) direct mail brochures B) live demonstrations C) samples D) online video E) focus groups

D

Oscarz Aviation's Web site, GoOscarzAv.com, informs customers about a wide variety of services offered by the firm. It also has a guestbook where customers can provide feedback on their experiences with Oscarz Aviation. They can also view videos Oscarz Aviation posts, as well as read and respond to blogs and ask questions. GoOscarzAv.com is an example of a(n) ________. A) online social network B) blog C) kiosk D) branded community Web site E) digital catalog

D

Overhead costs ________ as the number of units produced increases. A) decrease B) increase steadily C) fluctuate D) remain the same E) increase rapidly

D

PoolPak produces climate-control systems for large swimming pools. The company's customers are more concerned about service support for maintaining their systems than the initial price of the product. PoolPak specializes in and differentiates itself through both cutting-edge technologies used to build its high-value climate control systems as well as seamless quality service. PoolPak's prices are very high, but demand for its climate-control systems seems to be forever on the rise. This exemplifies ________. A) target costing B) a pure monopoly C) cost-plus pricing D) a nonprice position E) break-even pricing

D

Samsung Mobile plans to launch a new phone with a unit cost of $270 and wants to earn a 10 percent markup on its sales. Samsung's markup price is ________. A) $275 B) $280 C) $295 D) $300 E) $335

D

Service companies can differentiate their offering by ________. A) having a lower price than their competitors B) designing a superior delivery process C) offering a stellar physical environment in which the product is delivered D) developing innovative features E) adopting a recognizable image

D

Shoe Trends, a company that manufactures formal shoes for men and women, offers to give its customers $10 for an old pair of shoes when they buy a new pair. In essence, they're reducing the price of the new shoes by $10. What is this type of price adjustment called? A) functional discount B) captive product pricing C) seasonal discount D) trade-in allowance E) by-product pricing

D

Solar Tanning Salon prices tanning sessions at $25 per visit. It also offers seasonal passes for $175 that allow the customer to visit the salon multiple times in a year. This is an example of a ________. A) sample B) promotional allowance C) product bundle D) discount E) product line

D

Stores can combat the current consumer practice of ________, in which consumers visit stores and then check online for price comparisons. A) discounting B) conferencing C) using Instagram to share purchases D) showrooming E) auctioning

D

The Great Recession of 2008 to 2009 triggered a shift in consumer attitudes toward ________. A) variety and price B) perceptions of value C) locations of stores D) price and quality E) economic data

D

The customers of Parry's Hair Salon have noticed that the quality of a haircut depends on who provides it as well as when, where, and how the service is provided. Which of the following characteristics of service is evident in this instance? A) service intangibility B) service inseparability C) service perishability D) service variability E) service distinction

D

The major product line decision involves product ________, the number of items in the product line. A) features B) line depth C) line conformance D) line length E) packaging

D

The strongest brands are positioned on ________. A) desirable benefit B) good packaging C) service inseparability D) strong beliefs and values E) product attributes

D

Through ________, a service firm orients and motivates its customer-contact employees and supporting service people to work as a team to provide customer satisfaction. A) service inseparability B) social marketing C) service variability D) internal marketing E) corporate image marketing

D

Using ________ pricing, companies are able to turn their trash into cash, allowing them to make the price of their main product more competitive. A) product bundle B) optional product C) captive product D) by-product E) product line

D

Ways companies have avoided relying on price cuts in the new value-conscious era include all of the following EXCEPT ________. A) by adding more affordable product lines for the cost-conscious consumer B) by redefining the "value" in their value propositions C) by adding premium product lines for the higher end consumer D) by offering deep discounts E) by creating price tiers

D

What is a significant issue for social media and for companies using it as a marketing tool? A) measuring viewership B) creating content C) identifying target markets D) monetizing the tool E) recognizing effective social media sites

D

What is the core customer value a customer might purchase when buying Urban Decay cosmetics? A) variety of collections B) unique packaging C) unusual colors D) sense of adventure E) long-lasting makeup

D

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? A) segmented pricing B) international pricing C) reference pricing D) promotional pricing E) basing-point pricing

D

When a firm varies its price by the season, it is using ________ pricing. A) product form B) customer-segment C) location-based D) time-based E) value-added

D

Which of the following has become a major packaging concern in recent years? A) underpackaging B) legibility of print C) colors used D) product safety E) durability

D

Which of the following is NOT a category of consumer products? A) unsought B) specialty C) convenience D) luxury E) shopping

D

Which of the following is NOT a cue to consumers about whether a price is high or low? A) price-matching guarantees B) prices of surrounding, similar products C) signs such as "Clearance" D) "Coming Soon!" signs E) location in the store, especially at the entry

D

Which of the following is NOT a specific goal of branded community Web sites? A) present brand content that engages consumers B) build closer customer relationships C) generate engagement with and between the brand and its customers D) increase online sales E) allows visitors to interact with likeminded people to explore and communicate experiences with the brand

D

Which of the following is a potential drawback of multibranding? A) Multibranding tends to decrease brand loyalty. B) Company resources are likely to be concentrated on a single brand. C) Multibranding curbs the growth opportunities of established brands. D) Each brand might obtain only a small market share, and none may be very profitable. E) Multibranding causes companies to refrain from product diversification.

D

Which of the following is a type of identity theft that uses deceptive e-mails and fraudulent Web sites to fool consumers into revealing their personal data? A) bait-and-switch B) cyber spying C) viral marketing D) phishing E) spam

D

Which of the following is an advantage of using digital catalogs? A) lists the phone numbers of interested prospects B) coordinates with direct-response television ads C) points customers to the nearest kiosk D) eliminates printing and mailing costs E) creates emotional contact with customers

D

Which of the following is true of FOB-origin pricing? A) It is a strategy in which the company charges the same price plus freight to all customers. B) It is a costly option for customers who are located near the company. C) It charges all customers the freight cost from a base city to the customer location. D) It is an expensive alternative for customers in distant locations. E) It is a strategy in which the seller absorbs all or part of the freight charges.

D

Which of the following is true of price changes? A) Over-demand leads to companies initiating price cuts. B) Changes in price do not affect a brand's image. C) Customer reaction to price changes is not as important as competitor reaction. D) A drop in price can adversely affect how consumers view the brand. E) Excess capacity is a factor that causes increases in price.

D

Which of the following is true of the bottom of the pyramid? A) It is a market segment that has been tapped into and depleted. B) It consists of people who have easy access to luxury goods. C) It comprises people who have easy access to the basic amenities of life. D) It is considered a source of fresh growth opportunities. E) It is a market segment that has insignificant purchasing power

D

Which of the following is true with regard to monopolistic competition? A) Under monopolistic competition, the market consists of many buyers and sellers who trade at a single market price. B) Under monopolistic competition, the market consists of only a few large sellers. C) In a monopolistic market, little time is spent on marketing strategy. D) Sellers can differentiate their products to buyers. E) In a monopolistic market, price becomes a major competitive tool.

D

Which of the following is true with regard to price? A) Historically, price has had the least perceptible impact on buyer choice. B) Price is the least flexible element in the marketing mix. C) Unlike product features and channel commitments, prices cannot be changed quickly. D) Price is the sum of all the values that customers give up to gain the benefits of having a product. E) Prices only have an indirect impact on a firm's bottom line.

D

Which of the following is true with regard to products? A) The quality of products is far more difficult to measure than that of services. B) Products do not include experiences, organizations, persons, places, and ideas. C) Products are not meant for sale in the market. D) Products include services, events, persons, places, organizations, ideas, or a mixture of these. E) Products refer to only those activities that are essentially intangible.

D

Which of the following product mix pricing strategies did Polaroid use when it set the general price range of its cameras low and the markup on its film high? A) product-segmented pricing B) by-product pricing C) customer-segmented pricing D) captive product pricing E) product bundling pricing

D

Which of the following questions is most important for product designers to consider while developing a product? A) Which specific features of the product do customers like most? B) How does the product appear to buyers? C) What are the product's technical specifications? D) How would customers use and benefit from the product? E) How can the product be packaged to stimulate instant purchase?

D

Which of the following would most likely lead to a company initiating a price increase? A) weakened economy B) possession of outdated merchandise C) excess capacity D) over-demand E) possession of defective merchandise

D

While comparison pricing claims are legal if they are truthful, the FTC warns sellers not to advertise a) factory or wholesale prices unless such prices are what they claim to be, b) comparable value prices on imperfect goods, or c) ________. A) a sale unless the products are available in sufficient quantity to meet expected demand B) in a way which confuses potential buyers of the product C) a description of a product unless all versions of the product are offered with the same pricing terms D) a price reduction unless it is a savings from the usual retail price E) if only a limited quantity are available at the reduced price

D

Why are historically online shops such as Zappos.com adding catalogs to their marketing methods? A) to meet the increased demand in print catalogs B) to reduce the costs involved in online marketing C) to connect with customers in hard-to-reach places D) to drive online sales and services E) to reduce the need for telemarketers

D

Why is markup pricing most likely impractical? A) Calculating costs is complicated due to fluctuations. B) By tying the price to cost, sellers oversimplify pricing. C) When all firms in the industry use this pricing method, prices tend to be similar. D) The method ignores demand and competitor prices. E) With a standard markup, consumers know when they are being overcharged.

D

Why is markup pricing most likely popular? A) Sellers are more certain about demand than about costs. B) Markup pricing tends to maximize market competition. C) Markup pricing affords buyers greater bargaining power. D) Sellers do not need to make frequent adjustments as demand changes. E) Markup pricing is designed to set prices to break even on the costs of making and marketing a product.

D

________ are communities over the Internet where people congregate, socialize, and exchange views and information. A) Corporate Web sites B) Interactive television C) Digital catalogs D) Online social networks E) Content sponsorships

D

________ are consumer products and services that customers usually buy frequently, immediately, and with minimal comparison and buying effort. A) Unsought products B) Capital items C) Shopping products D) Convenience products E) Supplies and repair services

D

________ are industrial products. A) Major appliances B) Laundry detergents C) Life insurance policies D) Office supplies E) Legal services

D

________ involves creating a video, e-mail, mobile message, advertisement, or other marketing event that is so infectious that customers will seek it out or pass it along to their friends. A) Telemarketing B) Omni-channel marketing C) Integrated marketing D) Viral marketing E) Kiosk marketing

D

________ involves sending an offer, announcement, reminder, or other item to a person at a particular address. A) Kiosk marketing B) Online marketing C) Ambush marketing D) Direct-mail marketing E) Telemarketing

D

________ marketing features marketing messages and promotions delivered to on-the-go consumers through their handheld devices. A) Kiosk B) Ambush C) Direct-mail D) Mobile E) Catalog

D

________ products are those products purchased for further processing or for use in conducting a business. A) Unsought B) Specialty C) Shopping D) Industrial E) Convenience

D

________ refers to freedom from defects and consistency in delivering a targeted level of performance. A) Performance quality B) Product style C) Branding D) Conformance quality E) Product design

D

A good brand name should most likely be ________. A) trendy B) complex C) long D) conventional E) distinctive

E

A good design begins with ________. A) brainstorming new product ideas B) making prototypes of the planned product C) identifying the most suitable and aesthetic packaging D) brainstorming technical product specifications E) observing and understanding customers and shaping their product-use experience

E

A label can identify, promote, and ________ the product. A) sell B) assemble C) package D) brand E) describe

E

A manufacturing plant is designed to produce 2000 flat-screen TVs per day. But demand is higher than that. If the company tries to increase its production to 2500 TVs per day, the average costs will ________ because ________. A) decrease; the plant becomes more efficient B) stay the same; the plant becomes more efficient C) decrease; the plant becomes inefficient D) increase; the plant becomes more efficient E) increase; the plant becomes inefficient

E

A movie theater offers a reduced price for an afternoon showing of a film. This type of pricing is ________ pricing. A) location-based B) customer-segmented C) cost-based D) product form E) time-based

E

A number of top fashion-modeling agencies would most likely be charged with ________ for jointly determining what commissions they charge for models. A) prestige pricing B) competitive pricing C) price bundling D) dynamic pricing E) price fixing

E

After selecting a sweater on the Land's End Web site, Kelly was asked to fill in details for the customer database. Kelly was given a form that required her to fill in her name, date of birth, and e-mail address. Kelly then checked a box that was next to the following statement: "Yes, I would like to receive weekly promotional information from Land's End online." Which of the following practices is evident from this scenario? A) e-mail hosting service B) e-mail spoofing C) catalog marketing D) contextual advertising E) permission-based e-mail marketing

E

All of the following are Internet marketing concerns EXCEPT ________. A) financial scams B) access by vulnerable or unauthorized groups C) phishing D) identity theft E) secure online and digital Web sites

E

Amazon.com and GEICO approach customers via Web sites or mobile apps. This is an example of ________ marketing. A) mass B) niche C) individual D) multi-level E) direct

E

Brand ________ refers to how consumers feel if a brand meets their needs. A) differentiation B) equity C) dilution D) esteem E) relevance

E

Companies using target costing ________. A) first design a new product and then determine its cost B) tailor their products to be in line with the marketing mix C) routinely neglect customer value considerations D) avoid determining an ideal selling price until analyzing test market results E) start with an ideal selling price and then target costs that will ensure that the price is met

E

Digital catalogs offer all of the following benefits EXCEPT ________. A) presenting an almost unlimited amount of merchandise B) offering a broad assortment of presentation formats, including search and video C) adding and removing products as needed D) adjusting prices instantly to meet demand E) touching the product

E

Effective Web sites contain interactive tools that help find and evaluate content of interest, links to other related sites, useful information, changing promotional offers, and ________. A) celebrity endorsers B) respected columnists C) advertising for unrelated products D) enticements for customers to include their friends and contacts E) entertaining features that lend excitement

E

For a market penetration-price strategy to succeed, which of the following is LEAST likely to be true? A) Production costs decrease as sales volume increases. B) A low price triggers market growth. C) Distribution costs decrease as sales volume increases. D) Low prices must inhibit competition from entering the market. E) The strategy can be changed quickly, to a higher-priced position, with no negative impact.

E

Gainville Inc. manufactures Android phones. Each new Gainville phone launch advances the cause of democratizing technology. Gainville, an expert in fostering customer community, engages customers at a deep, emotional level, and has been ranked one of the Breakaway Brands by the brand consultancy, Kendell Associates. Gainville is most likely positioned on ________. A) basic product attributes B) short-term benefits C) service variability D) self-image enhancement E) strong beliefs and values

E

How has do-not-call legislation helped direct marketers? A) Marketers are compensated by the Federal Trade Commission for lost sales caused by the laws. B) Direct marketers have outsourced their activities to firms that are exempt from such laws. C) Direct marketers have developed kiosks as an alternative to telemarketing. D) Telemarketers are allowed to call customers for a small fee. E) Telemarketers have developed opt-in calling systems that target consumers who have chosen to be contacted and therefore are less invasive.

E

If a consumer purchases a new flat-screen "smart" television, what is the augmented product involved? A) connection to the world of entertainment B) state-of the art technology C) slick and attractive packaging D) brand name E) tech support and warranty

E

In industries in which pricing is a key factor, ________ often set the best prices or help others in setting them. A) sales departments B) salespeople C) production managers D) line managers E) pricing departments

E

John assured his venture capitalists an earning of 25-percent return on equity when he began his IT startup. In order to achieve this result, he will most likely use which of the following pricing approaches? A) value-based pricing B) markup pricing C) EDLP D) customer-based pricing E) target return pricing

E

Josh received an e-mail stating that he had won a lottery of $500,000 from Lottors Corporation. The e-mail asked Josh to send his bank account details and social security number to transfer cash directly to his account. Josh did not remember buying any lottery tickets, and so was apprehensive about providing his bank details without verification. Which of the following is illustrated from this scenario? A) adware B) viral marketing C) telemarketing D) cyberbullying E) phishing

E

Mansfield Pharmaceuticals markets Zipro, an antibiotic. The firm has fixed costs of $1,000,000 and variable costs of $2 per bottle of 50 tablets priced at $10 per bottle. What is the break-even volume? A) 25,000 B) 55,000 C) 100,000 D) 115,000 E) 125,000

E

Music Mogul has arrangements with several stores and retail chains to place their DVDs and digital music machines in prime spots such as near billing counters and at store entrances. Consumers can buy DVDs by depositing payment or they can buy music online via the touchscreen interface on the machine. Which form of marketing is illustrated in this scenario? A) direct-response television advertising B) telemarketing C) interactive television D) podcast marketing E) kiosk marketing

E

Online companies include all of the following EXCEPT ________. A) content sites B) online social media C) search engines and portals D) transaction sites E) brick-and-mortar

E

Questions a company should consider if a competitor initiates a price change include all of the following EXCEPT ________. A) "Are other competitors going to respond?" B) "What will happen to the company's market share if it does not respond?" C) "Is the price change temporary or permanent?" D) "Why did the competitor change the price?" E) "How can we improve our product?"

E

Randy keeps getting unwanted and annoying e-mails from several marketing firms unknown to him. The number of these e-mails is alarmingly high in his inbox. Which of the following best describes these e-mails? A) malware B) adware C) Trojan D) firewall E) spam

E

Reasons for a price increase include all of the following EXCEPT ________. A) a desire to improve profits B) cost inflation C) when the alternative is rationing of the product D) decreasing gross margins E) increasing supply of product

E

Reasons sellers go beyond what is required by pricing regulations include all of the following EXCEPT that ________. A) it is good business to treat customers fairly B) customers that fully understand prices and pricing terms are happy customers C) word-of-mouth from dissatisfied customers spreads rapidly D) building strong and lasting relationships is key to business success E) it improves profitability to earn additional revenue due to customer confusion

E

Runner Sprintz, a particular brand of shoes, has its own Web site, myrunnersprintz.com that welcomes consumers to "the Runner Sprintz Century," invites readers to post their Runner Sprintz stories, and offers a wide variety of shoes for direct purchase. The site even allows customers to individually design their own shoes and share them among their circles on the Web site. Which of the following best describes myrunnersprintz.com? A) Web directory B) blog C) corporate Web site D) digital catalog E) branded community Web site

E

Savings for You, a discount retail chain, is highly competitive. When entering a new market, Savings for You often cuts prices so deeply that it sells below costs, effectively pushing smaller companies with less purchasing power out of the market. Savings for You is most likely guilty of ________. A) market skimming B) price fixing C) deceptive pricing D) price collusion E) predatory pricing

E

Service companies can differentiate their service delivery by ________. A) using symbols and logos B) instituting a hierarchical organizational structure C) offering innovative product features D) de-emphasizing branding E) having more able and reliable customer-contact people

E

Some companies obtain the rights to use the names or symbols previously created by other manufacturers for a fee. This process is known as ________. A) multibranding B) positioning C) segmenting D) co-branding E) licensing

E

SparkClean is a company that specializes in producing cleaning products for automobiles. In order to promote its products, SparkClean sends a complimentary sample of its products to auto enthusiasts. Which form of marketing is SparkClean involved in? A) online marketing B) viral marketing C) telemarketing D) kiosk marketing E) direct-mail marketing

E

Tourism Australia's global marketing campaign, "There's nothing like Australia" is an example of ________ marketing. A) corporate image B) person C) organization D) internal E) place

E

Under oligopolistic competition ________. A) the market consists of a single dominant seller B) the market consists of numerous small sellers C) the market consists of many buyers and sellers who trade over a range of prices rather than a single market price D) sellers are typically unresponsive to competitors' pricing strategies and marketing moves E) the market consists of only a few large sellers

E

Under which type of geographic pricing strategy does each customer take responsibility for the freight charges for the product from the factory to its destination? A) zone pricing B) basing-point pricing C) uniform-delivered pricing D) dynamic pricing E) FOB-origin pricing

E

What is a disadvantage of a viral success? A) Many people will see the marketing message. B) The cost per exposure is relatively low. C) Word-of-mouth is strong. D) Publicity is always good. E) Marketers have little control over where the message ends up.

E

What is the most likely reason that direct-response television marketing has increased in recent years? A) uses of social media B) shifts in demographics C) increases in global demand D) changes in FTC legislation E) advances in technology

E

When amusement parks charge customers for admission and later for food and beverages, they are following a ________ pricing strategy. A) by-product B) product line C) penetration D) skimming E) two-part

E

Which of the following companies uses product bundle pricing? A) Photo Genie, which sells inexpensive cameras that run only on their own, expensive, batteries B) Go Zone, which launched a range of tablet models, each priced according to its features C) Penguin's Parlor, which offers customers a 20 percent discount on their birthdays D) Green Thumb, which gives away free watering cans with the purchase of certain potted plants E) Panizza, whose combo meals are priced lower than its individual components sold together

E

Which of the following exemplifies a pure competitive market? A) a market where many buyers and sellers trade over a range of prices rather than a single market price B) a market where a single firm controls the larger fraction of the market share C) a market where a few powerful firms control the larger fraction of the market share D) a market characterized by only a few large sellers E) a market where many buyers and sellers trade in a uniform commodity

E

Which of the following involves setting prices based on a rival firm's strategies, costs, prices, and market offerings? A) target return pricing B) good-value pricing C) competitor value-added pricing D) market-based pricing E) competition-based pricing

E

Which of the following is a benefit of using blogs as marketing tools for companies? A) Blogs provide companies with a platform to help portray wider merchandise. B) Blogs are online selling platforms for people located in hard-to-reach places. C) Blogs help reach a wider audience compared to other online direct marketing tools. D) Demographic information about customers can be easily discovered. E) Blogs can offer a fresh, original, personal, and cheap way to enter into consumer conversations.

E

Which of the following is a price adjustment strategy? A) product bundle pricing B) by-product pricing C) product line pricing D) optional product pricing E) discount and allowance pricing

E

Which of the following is an example of a pure tangible good? A) a laptop with a comprehensive warranty for three years B) an online shoe retailer that provides free home delivery C) an agency that offers free legal advice D) a credit card E) a bag of potato chips

E

Which of the following is most likely a fixed cost? A) sales representative commissions B) product distribution costs C) manufacturing input costs D) temporary worker salaries E) facility rental payments

E

Which of the following is most likely a risk associated with experience-curve pricing? A) High-volume production facilities are unable to meet demand. B) New technology often leads to productivity problems. C) Demand for the product fluctuates unpredictably. D) Consumers tend to prefer new brands over established ones. E) Aggressive pricing often gives a product a cheap image.

E

Which of the following is most likely an advantage of viral marketing? A) Viral marketing reinforces consumers' attitudes about a brand. B) Most messages are likely to "go viral." C) Consumers want to be a part of viral marketing. D) Viral marketing can easily be successfully accomplished. E) Viral marketing produces engagement and positive exposure for a brand.

E

Which of the following is one of the four consumer perception dimensions used by ad agency Young & Rubicam to measure brand strength? A) brand conformance B) brand consistency C) brand convenience D) brand extension E) brand relevance

E

Which of the following is true about the demand curve? A) A demand curve indicates the drop in the average per-unit production cost that comes with accumulated production experience. B) A demand curve indicates the cost per unit of output in the long run. C) A demand curve indicates the cost per unit of output in the short run. D) In a monopoly, the demand curve does not indicate the total market demand resulting from different prices. E) A demand curve shows the number of units the market will buy in a given time period at different prices that might be charged.

E

Which of the following is true of a pure competitive market? A) A single seller has a major effect on the current and future market price. B) Companies spend significantly on marketing research and product development. C) The advertising budget of companies is usually huge. D) Sellers try to develop differentiated offers for different customer segments. E) Sellers spend little time on marketing strategy

E

Which of the following is true with regard to store brands? A) Store brands have been declining in popularity and strength for more than two decades. B) Store brands are also known as national brands. C) Store brands are created and owned by resellers of a product or service. D) Increasing consumer distrust toward store brands has led to a store-brand slump. E) Store brands are growing far slower than manufacturer's brands.

E

Which of the following price adjustment strategies involves reducing prices to reward customer responses such as volume purchases, paying early, or participating in sales-support programs? A) product bundle pricing B) captive product pricing C) product line pricing D) dynamic pricing E) discount and allowance pricing

E

Which of the following product mix pricing strategies involves pricing additional or accessory products sold along with the main product? A) inclusive product pricing B) exclusive product pricing C) by-product pricing D) product bundle pricing E) optional-product pricing

E

Which of the following product mix pricing strategies involves setting prices across an entire product range based on cost differences between the products, customer evaluations of different features, and competitors' prices? A) by-product pricing B) product bundle pricing C) optional product pricing D) captive product pricing E) product line pricing

E

Which of the following product offerings is intangible? A) a package of laundry detergent B) an ink cartridge for a printer C) a wool jacket D) a gold ring E) a taxi ride

E

Which of the following statements about break-even analysis is true? A) It is used to determine how much production experience a company must have in order to achieve desired efficiencies. B) It is a technique used to calculate fixed costs. C) It determines the amount of retained earnings a company will have during a given accounting period. D) It is a technique marketers use to determine the relationship between supply and demand. E) It is calculated by using variable costs, the unit price, and fixed costs.

E

Which of the following terms refers to a 30-minute television advertising program that markets a single product? A) social media B) digital catalog C) telemarketing D) blog E) infomercial

E

While shopping at KelfanDesigns.com, Shelly came across a checkbox beside which a statement said, "I want to receive promotional offers from KelfanDesigns.com." Which of the following types of marketing is illustrated in this example? A) telemarketing B) viral marketing C) direct response television marketing D) contextual advertising E) permission-based e-mail marketing

E

________ allows consumers to gain additional information about a product through the use of a remote control. A) Telemarketing B) Kiosk marketing C) Podcasting D) Video conferencing E) Interactive television

E

A cell phone manufacturing firm produced 1,000 cell phones a day but believed that it could reasonably step up production to 2,000 cell phones a day. Consequently, it built a larger plant and installed efficient machinery and work arrangements to realize the projected output. Which of the following can most likely be inferred from this information? A) The unit cost of producing 2,000 cell phones per day would be twice that of the unit cost of producing 1,000 units per day. B) A production plant with the capacity of producing 5,000 cell phones a day would be most efficient. C) The unit cost of producing 2,000 cell phones per day would be lower than the unit cost of producing 1,000 units per day. D) A 2,000-capacity production plant would be less efficient because of increasing diseconomies of scale. E) The fixed costs of the firm are more likely to increase with the increase in output.

c

Departments or managers that have an influence on pricing include sales managers, finance managers, accountants, and ________. A) engineering managers B) human resources managers C) production managers D) customers E) resellers

c