Chapter 19 Concept Quiz - 350

A company's rental of production space is an example of a _______. a. fixed cost b. variable cost c. breakeven point d. total cost e. marginal cost

a. fixed cost

ACME Corp.'s widgets have elastic demand. If ACME raises the price of widgets, what will be the result? a. An increase in market share b. An increase in total revenue c. A decrease in product inventory d. A decrease in total revenue e. A decrease in market share

d. A decrease in total revenue

Which of the following pass on to a business customer the cost savings gained through economies of scale? a. Quantity discounts b. Allowances c. Seasonal discounts d. Trade discounts e. Cash discounts

a. Quantity discounts

Which of the following charges the same price to all customers regardless of geographic location, and the price is based on average shipping costs for all customers? a. Uniform geographic pricing b. Base-point pricing c. Freight absorption pricing d. F.O.B. destination pricing e. Zone pricing

a. Uniform geographic pricing

ACME Corp. and Spacely Inc. are engaged in intense price competition in order to boost market share of their widgets. This is best described as _______. a. a price war b. nonprice competition c. elasticity of demand d. bartering e. price discrimination

a. a price war

Which of the following is calculated by dividing the variable costs by the number of units produced? a. Average variable cost b. Average fixed cost c. Average total cost d. Breakeven point e. Marginal cost

a. Average variable cost

Which of the following is the point at which the costs of producing a product equals the revenue made from selling the product? a. Demand curve b. Breakeven point c. Marginal revenue d. Marginal cost e. Fixed cost

b. Breakeven point

Which of the following is a major advantage of nonprice competition? a. Fostering a price-conscious mindset b. Exceeding the breakeven point c. Building customer loyalty toward the brand d. Fostering a value-conscious mindset e. Building market share

c. Building customer loyalty toward the brand

Which of the following shows the quantity of products a firm expects to sell at various prices if other factors remain constant? a. Demand line b. Marginal analysis c. Demand curve d. Reference price e. Breakeven point

c. Demand curve

Which of the following is NOT one of the factors that influence the assessment of value? a. Price levels b. Time constraints c. Elasticity of demand d. Perceived quality e. Motivations to use available information about prices

c. Elasticity of demand

To compete effectively on a price basis, a firm should _______. a. have the highest market share b. have the lowest market share c. be the low-cost seller of the product d. have the highest quality e. be the high-cost seller of the product

c. be the low-cost seller of the product

Spacely Inc.'s sprockets have inelastic demand. If Spacely raises the price of sprockets, what will be the result? a. A decrease in market share b. An increase in market share c. A decrease in product inventory d. An increase in total revenue e. A decrease in total revenue

d. An increase in total revenue

Maria is concerned about both price and quality of a product. Marketers would best describe her as which of the following? a. Price-conscious b. Price-obsessed c. Prestige-sensitive d. Value-conscious e. Utility-sensitive

d. Value-conscious

A price developed in the buyer's mind through experience with the product is a(n) _______. a. experience price b. breakeven point c. trade discount d. internal reference price e. external reference price

d. internal reference price

Price is a key element in the marketing mix because it relates directly to the generation of total _______. a. elasticity of demand b. profits c. market share d. revenue e. price competition

d. revenue

ACME Corp. offers a price discount to encourage prompt payment. Which of the following is it likely to use? a. Seasonal discount b. Allowance c. Trade discount d. Quantity discount e. Cash discount

e. Cash discount

The Federal Trade Commission (FTC) is investigating ACME Corp. for using misleading price tags at its outlet stores to deceive customers into believing they are getting a bargain on Wile E. branded items. Which of the following does the FTC believe ACME is guilty of? a. Price discrimination b. Price fixing c. Price competition d. Nonprice competition e. Deceptive pricing

e. Deceptive pricing