Marketing Ch.9
________________________ is one major objective associated with a market-penetration pricing strategy.
Winning large market share
A car buyer can choose a base model at one price, or one with a premium sound and navigation system at a higher price. This is an example of _______ pricing.
optional-product
Which of the following refers to setting prices based on buyers' perception of value rather than on the seller's cost?
Customer value-based pricing
Which of the following is true regarding the price-demand relationship?
If demand is elastic, sellers will consider lowering their prices.
When, if ever, is price discrimination allowed?
If the seller can prove that its costs are different when selling to different retailers, then it is legal.
Of the following, which is true about pricing?
Price competition is a core element of our free-market economy.
The illegal practice of ______________________ is selling below cost with the intention of punishing a competitor or gaining higher long-run profits by putting competitors out of business.
predatory pricing
The Ford Mustang is offered in several different models. Ford uses __________ pricing to determine the price steps between the different models.
product line
Gillette charges a fairly low price for its razors (relative to costs) and a high price for razor blades. It is using a strategy of ___________ pricing.
captive-product
A variation of break-even pricing is ____________________, which uses the concept of a break-even chart that shows the total cost and total revenue expected at different sales volume levels.
Target return pricing
When sellers set prices in conjunction or collaboration with one another, this illegal practice is known as _______________.
price-fixing
Internal factors that affect pricing include _________________.
The company's overall marketing strategy, objectives, and marketing mix
Continually adjusting prices to meet the characteristics and needs of individual customers and situations is known as _______________________.
dynamic pricing
The Robinson-Patman Act seeks to ensure that sellers offer the same price terms to customers at a given level of trade to prevent ______________________.
price discrimination
When a college or university charges more for out-of-state students than in-state students, it is practicing ______________________.
location-based pricing
A company has set a low price on a new product it introduced. It wants to maximize its market share and attract a large number of buyers quickly. Which new product pricing strategy should the company use?
market-penetration pricing
If the company has selected its target market and positioning carefully, then its marketing mix strategy, including price, will be fairly straightforward. Of the following, which is NOT one of the common pricing objectives?
Grabbing international market share
Roshika has been invited to a fancy dinner party and wants to bring a good bottle of wine as a gift for the host. Since she does not know much about wine, she will likely use the price of the wines as ________.
an indicator of quality
When Apple introduced its iPhone X, it priced the new product at nearly $1,000, considerably higher than competing smart phones. Apple was pursuing a ___________________ new product pricing strategy.
premium pricing
Bath & Body Works uses _____________ pricing when the company offers "three-fer" deals on its products (such as soaps, lotions, and moisturizers).
product bundle
When a retailer temporarily prices a few select items below cost to create excitement and pull consumers into the store, it is practicing ___________________ pricing.
promotional
Which of the following reverses the usual process of first designing a new product, determining its cost, and then asking, "Can we sell it for that?"
target costing
UPS uses _________________, which charges different prices for shipping depending on an item's destination. The more distant the city where the package is being shipped, the higher the price UPS charges.
zone pricing
Sadie's Restaurant has listened to its customers over the years and is now able to offer the right combination of quality and good service at a fair price. Which pricing strategy is Sadie's using?
Good-value pricing
New, premium movie theaters offer features such as online reserved seating, high-backed leather executive chairs with armrests and footrests, the latest in digital sound, super-wide screens, and other amenities for which they charge a higher price. This is an example of which type of pricing?
Value-added pricing