Marketing - Chapter 14 (Test 3)

Predatory Pricing is illegal under which 2 acts?

Sherman Act & FTC

______ is setting the highest initial price that customers who really desire the product are willing to pay

Skimming Pricing

To encourage retailers to pay their bills quickly, manufacturers offer them _________

cash discounts

A firm that sets an annual target of a specific dollar volume of profit is using a _____ pricing approach

target profit

________ are reductions in unit costs for a larger order

Quantity Discounts

The Clayton Act as amended by the Robinson-Patman Act prohibits ___________ —the practice of charging different prices to different buyers for goods of like grade and quality

price discrimination

_____ pricing is the setting of prices for all items in a product line

product-line

High-volume products usually have ______ markups than low-volume products.

smaller

Functional reductions off the list or base price are offered to resellers in the marketing channel on the basis of __________ and __________

where they are in the channel and (2) the marketing activities they are expected to perform in the future

Bundle Pricing is an example of a _____ pricing approach

Demand

What is the purpose of loss-leader pricing?

Attract customers

Above-, At-, or Below-Market Pricing pricing is an example of a ____ pricing approach

Competition

Customary Pricing pricing is an example of a ____ pricing approach

Competition

Loss-Leader Pricing pricing is an example of a ____ pricing approach

Competition

Cost plus pricing is an example of a ____ pricing approach

Cost

Standard Markup pricing is an example of a ____ pricing approach

Cost

______ involves summing the total unit cost of providing a product or service and adding a specific amount to the cost to arrive at a price.

Cost Plus pricing

_____ is the most commonly used method to set prices for business products

Cost-plus pricing

______ apply to the accumulation of purchases of a product over a given time period, typically a year

Cumulative

For some products where tradition, a standardized channel of distribution, or other competitive factors dictate the price, _____ pricing is used

Customary

Odd-Even Pricing is an example of a _____ pricing approach

Demand

Penetration pricing is an example of a ____ pricing approach

Demand

Prestige pricing is an example of a _____ pricing approach

Demand

Price Lining is an example of a _____ pricing approach

Demand

Skimming is an example of a _____ pricing approach

Demand

Yield Management pricing is an example of a _____ pricing approach

Demand

________ is the practice of replacing promotional allowances with lower manufacturer list prices

Everyday low pricing (EDLP)

Deceptive pricing is outlawed by the _______ Act.

Federal Trade Commission

A ____ price policy, also called a ____ price policy, is setting one price for all buyers of a product or service

Fixed, one

For a special promotion, retail stores deliberately sell a product below its customary price to attract attention to it, this is called ____ pricing

Loss Leader

During skimming, are customers sensitive to prices?

No.

______ quantity discounts are based on the size of an individual purchase order.

Noncumulative

_______ quantity discounts are based on the size of an individual purchase order. They encourage ____ individual purchase orders.

Noncumulative. Large

____ involves setting prices a few dollars or cents under an even number

Odd-Even Pricing

Many segments of the market are price sensitive, a low initial price discourages competitors from entering the market, and unit production and marketing costs fall dramatically as production volumes increase are the conditions favoring ____

Penetration Pricing

________ involves setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it

Prestige Pricing

A firm that is selling not just a single product but a line of products may price them at a number of different specific pricing points, which is called ______

Price lining

Target Return-on-Investment Pricing is an example of a _____ pricing approach

Profit

Target Return-on-Sales Pricing is an example of a _____ pricing approach

Profit

Target profit Pricing is an example of a _____ pricing approach

Profit

______ entails adding a fixed percentage to the cost of all items in a specific product class

Standard Markup pricing

_________ pricing approach sets typical prices that will give them a profit that is a specified percentage, say, 1 percent, of the sales volume

Target Return on Sales

What is the equation for Target Return on Sales?

Total Profit / Total Revenue

To reward wholesalers and retailers for marketing functions they will perform in the future, a manufacturer often gives _____, or _______, discounts.

Trade, functional

______ is the charging of different prices to maximize revenue for a set amount of capacity at any given time.

Yield Management Pricing

cost-plus ______ pricing means that a supplier is reimbursed for all costs, regardless of what they turn out to be, but is allowed only a fixed fee as profit that is independent of the final cost of the project

fixed-fee

Setting a low initial price on a new product to appeal immediately to the mass market is ______

penetration pricing

With cost-plus _______ pricing, a fixed percentage is added to the total unit cost

percentage-of-cost

To encourage buyers to stock inventory earlier than their normal demand would require, manufacturers often use _______ discounts

seasonal