MKT304 Quiz 14

Customers must see value in a product or service before they are willing to exchange time or money to obtain it, but not all customers see the same value in a product. To analyze how many units will be sold at any given price point, marketers draw on

A demand curve

The point at which the number of units sold generates enough revenue to equal the total costs of running an operation is known as the

Break-Even point

If all three grocery stores in town decide to charge the same price for a gallon of milk, what type of pricing tactic is being used?

Horizontal price fixing

Consumers generally believe that ________ is one of the most important factors in their purchase decisions.

Price

If a 1 percent decrease in price results in less than a 1 percent increase in the quantity demanded, demand is

Price elastic

Bernard's firm has set corporate direction to become one of the leaders in each of its significant market segments. It was Bernard's job to examine the firm's pricing strategy to determine how to maximize market share, even at the expense of profits in the short run. What kind of company objective would guide Bernard's effort?

Sales-oriented

According to a typical demand curve, the higher the price,

The lower the quantity consumers will buy

All of the following are included in the five Cs of pricing except

collaboration

When firms set prices similar to those of competitors, they are following a strategy of

competitive parity

When Ursula decides how to price new products in her gift store, she measures the value of her product offerings against those of the other stores in her area. Ursula uses a ________ pricing strategy.

competitor-oriented

Julia wants her firm's gourmet snacks to be the leading brand in the U.S. market. When adopting a pricing strategy designed to gain market share, she should remember that

rarely is the lowest-price offering the dominant brand in a market.

Brad always buys and uses Nike brand golf balls. If he finds a Titleist or Callaway ball in the rough, he gives it away. Brand-loyal golfers like Brad allow Nike to charge a higher price and not lose many sales. By building a strong brand, Nike has effectively

reduced the price elasticity of demand for its products

David manages a Shoney's restaurant. He is considering staying open later in the evening. For David, the variable costs associated with staying open longer hours will include all of the following except

rent on the restaurant building

Predatory pricing

selling a product below cost to drive competitors out of the market

Ryan gave the manager of his convenience store a set of binoculars so she could see the gasoline prices charged by the other convenience store at that intersection. Ryan told the manager to always match the gasoline prices of the other store. Ryan is using a ________ pricing strategy.

status quo

Rodi owns Hallman's auto repair service. He has observed over the years that customers keep their high-mileage cars longer when the economy is doing poorly, creating demand for his maintenance and repair service. Rodi has observed the impact of ________ on demand for his service.

the income effect

Sales of national brands of orange juice tend to increase when the economy is doing well, while sales of generic orange juice increase when the economy is not doing well. This is an example of how ________ impacts demand for products.

the income effect

A customer orientation toward pricing implicitly invokes the concept of

value

A strategy of setting prices based on how customers develop their perceptions of value can often be the most effective pricing strategy, especially if the strategy

is supported by consistent advertising and distribution strategies