MKT-101 Chapter 19

What equation shows organizations the relationship between price and profit?

(Price × Quantity Sold) − Total Costs = Profits

Which of the following is NOT a discount provided to business customers?

Differentiated

What does the demand curve for a prestige product look like?

It forms a curve where the greatest quantity sold comes at a medium price, and the quantities fall as the price increases or decreases.

Which of the following statements is true about the factors that affect pricing decisions?​

Marketers should set prices that are consistent with the organization's goals and mission.

The ____ prohibits price fixing among firms in an industry.

Sherman Antitrust Act

Which factor is least likely to affect pricing decisions?

Shifting stock values

Which of the following acts does NOT directly affect pricing decisions?

Simpson-Marshall Act

Which of the following statements about price elasticity is false?

When price is raised on a product that has an inelastic demand, then total revenue will decrease.

One advantage of nonprice competition is that

a firm can build customer loyalty.

A price developed in the consumer's mind through experience with the product is called a(n)

internal reference price.

What a price means or what it communicates to customers is called

interpretation.

For most products, a(n) ____ relationship exists between the price of a particular product and the quantity demanded.

inverse

Average fixed cost declines as

output increases.

When marketers emphasize price as an issue and match or beat the prices of other companies, they are using

price competition.

A measure of sensitivity of demand in relation to changes in price is

price elasticity of demand.

To determine the breakeven point in units, divide the fixed costs by

price minus variable costs.

Price is a key element in the marketing mix because it relates most directly to

the generation of total revenue.

At the breakeven point,

the money a company brings in from selling products equals the amount spent producing the products.

If a product has an inelastic demand and the manufacturer raises its price,

total revenue will increase.

A company trying to position itself as value oriented should NOT

use premium pricing for its products.