ch 8

Pricing directly reflects the ________ that the product delivers to consumers and captures for the firm. Multiple choice question. value branding satisfaction marketing

value

Pricing directly reflects the ________ that the product delivers to consumers and captures for the firm. Multiple choice question. value satisfaction marketing branding

value

Pricing is one of the most watched and regulated marketing activities because it _______. Multiple choice question. indirectly affects the prices of stock and bonds predicts the amount of tax revenue that the government will collect is the most important component of the marketing mix directly affects the financial viability of organizations and individuals

directly affects the financial viability of organizations and individuals

It is likely that, sometime in the next two decades, technology will completely replace salespeople. True false

False

Markup pricing is an effective method for maximizing profits. True false

False

Predictive analytics is concerned mostly with analyzing the past, not about planning for the future. True false

False

Price discrimination is always illegal. True false question.TrueFalse

False

Usually, it is easy to prove that a company has engaged in predatory pricing. True false question.TrueFalse

False

Which two laws in the United States make price fixing illegal? Multiple select question. Federal Trade Commission Act Dodd-Frank Act Robinson-Patman Act Sherman Antitrust Act

Federal Trade Commission Act Sherman Antitrust Act

Suppose that it costs Ford $20,000 to produce a Ford Focus. Sales managers have decided that they want to earn a 20% profit on every car that the company sells. The price of a Ford Focus will therefore be ______. Multiple choice question. $28,000 $24,000 $20,000 $30,000

$24,000

If organizations raise prices by just 1 percent, and if demand remains constant, then profits will go up on average by __ percent. Multiple choice question. 33 15 8 1

8

From the following list, select the three scenarios in which the Robinson-Patman Act allows price discrimination. Multiple select question. A competitor undercuts the originally quoted price, allowing the company to lower its price in order to get the business. A certain customer has not researched prices very carefully, thus permitting a company to raise its price without angering that customer. A company is going out of business and is trying to sell off its inventory. The price differences charged are part of a quantity or manufacturing discount program.

A competitor undercuts the originally quoted price, allowing the company to lower its price in order to get the business. A company is going out of business and is trying to sell off its inventory. The price differences charged are part of a quantity or manufacturing discount program.

Which one of the following is an example of deceptive pricing? Multiple choice question. A cosmetics company usually sells its lipstick for $6 a tube. It places an ad on the Internet saying: "A $25 value, now just $5.99 per lipstick." A bed-and-breakfast offers discounted rates on weekdays in the winter, when tourist traffic is usually low. To drive its competitors out of business, a home-improvement warehouse sets its prices so low that local hardware stores cannot compete. Three major cereal companies agree that they will charge a minimum of $4.99 for a 28-ounce box of their cereals.

A cosmetics company usually sells its lipstick for $6 a tube. It places an ad on the Internet saying: "A $25 value, now just $5.99 per lipstick."

AI-enabled sales assistants are most similar to ______. Multiple choice question. Salesforce.com Oracle SAP Fieldglass Amazon's Alexa

Amazon's Alexa

Fixed costs vary with the number of units produced or sold. True false

False

In general, an organization does not benefit from getting its salespeople involved in pricing decisions. True false

False

From the following list, select all the statements that are true of profitability analysis. Multiple select question. It measures how much profit the firm generates. It is relevant mostly to accountants, not to salespeople and sales managers. It can involve measuring customer acquisition and customer profitability. It can be broken down to measure the profit contribution of regions, products, channels, or customer segments.

It measures how much profit the firm generates. It can involve measuring customer acquisition and customer profitability. It can be broken down to measure the profit contribution of regions, products, channels, or customer segments.

_ pricing is the practice of setting prices low with the intention of reducing competition and then raising prices to normal levels.

Predatory

_ analytics is the use of data, statistical algorithms, and machine-learning techniques to identify the likelihood of future outcomes based on historical data.

Predictive

is the amount of something—money, time, or effort—that a buyer exchanges with a seller to obtain a product.

Price

Match each scenario with a likely possible result.

Prices are too high. The company loses sales. Prices are too low. The company is not maximizing its profit.

Which of the following statements are true of salespeople's role in market research? There is more than one correct answer. Multiple select question. Salespeople are rarely able to collect information about their competitors' products and prices. Salespeople conduct qualitative research all the time as they interact with current and potential customers. Talking to salespeople is perhaps the lowest-cost qualitative research project an organization can do. Salespeople provide an extensive amount of data on customers and potential customers that can help organizations set and manage prices.

Salespeople conduct qualitative research all the time as they interact with current and potential customers. Talking to salespeople is perhaps the lowest-cost qualitative research project an organization can do. Salespeople provide an extensive amount of data on customers and potential customers that can help organizations set and manage prices.

What is the key reason for measuring customer-acquisition costs? Multiple choice question. Customer-acquisitions costs represent a company's highest cost category. Sometimes additional customers don't equal additional profit. Company managers need to know customer-acquisition costs in order to develop new products. Salespeople must be evaluated and bonused on the costs of acquiring new customers.

Sometimes additional customers don't equal additional profit.

Identify the two steps in setting and negotiating prices.

Step 1 Work out all the costs associated with a product. Step 2 Add an amount to ensure you make a profit relative to your opportunity cost.

__ pricing involves proactively creating the conditions under which better and more-profitable pricing outcomes are the result. Multiple choice question. Markup Discounted Strategic Mandatory

Strategic

When pricing a product, you must ensure that your price is not lower than the total costs of producing that product. True false

True

Which one of the following is an example of price fixing? Multiple choice question. A local pub offers discounted beverages for women on Tuesday "Ladies' Night." Three oil companies collude to ensure that they never sell gasoline for less than $3.29 per gallon. The manufacturer of word-processing software prices its product so low that all other word-processing software producers go out of business. Students receive 10 percent off books and clothing at a bookstore located near their college.

Three oil companies collude to ensure that they never sell gasoline for less than $3.29 per gallon.

A lack of product features can sometimes be beneficial in making sales. True false

True

AI-enabled sales assistants can help salespeople perform a wide range of routine tasks, such as sending out emails. True false

True

Good CRM software gives salespeople the opportunity to collect customers' details, which they can use to maintain the customer relationship and deliver helpful and relevant information that increases the frequency of purchase. True false

True

In recent years, federal tax laws have made it more difficult for people to write off charitable deductions. True false question.TrueFalse

True

Including data about price quotes and margin levels in CRM systems is essential. True false question.TrueFalse

True

It is accurate to think of your salary as the price that your employer pays you. True false

True

Lead scoring helps a company make sure that prospects are matched to the right sales reps at the most appropriate time, based on prospect behaviors, buying stage, interests, or demographic factors. True false

True

Pricing is one of the most watched and regulated marketing activities because it directly affects the financial viability of organizations and individuals. True false

True

_ means offering something that provides the best set of benefits at a specific price point, not necessarily the lowest price.

Value

_ costs are costs that vary depending on the number of units produced or sold.

Variable

Suppose you plan to buy a central air conditioning unit for your home. Company A quotes you a price of $10,000. You then visit Company B, and its salesperson quotes you a price of $9,000 for the same A/C unit, putting that price in writing. You go back to Company A, show the salesperson Company B's written price offer, and ask Company A for a better price. Company A then quotes you a price of $8,500. Is Company A's price-cutting behavior legal? Multiple choice question. Yes No

Yes

Customer _ analysis measures how much a firm spends to gain new customers. (Be careful with spelling.)

acquisition

The key to successful CRM is ______. Multiple choice question. social media presence actionable data asynchronous communication automated responses

actionable data

From the following list, select all the examples of fixed costs. Multiple select question. advertising costs rent salaries insurance raw materials sales commissions

advertising costs rent salaries insurance

Which of the following are the three important considerations in profitology? Multiple select question. cost sales volume price customer satisfaction value

cost sales volume price

Profitology involves understanding all of the _______ involved in a sale in order to maximize profitability. Multiple choice question. accounting practices customers sales taxes costs

costs

From the following list, select two important metrics for profitability. Multiple select question. Q-score customer acquisition EBITDA customer profitability

customer acquisition customer profitability

Match each aspect of business with the departments that manage or understand it best.

customer value product, sales, and service departments costs procurement, operations, and finance departments

Which practice involves intentionally misleading customers with price promotions? Multiple choice question. price fixing predatory pricing deceptive pricing price discrimination

deceptive pricing

Which practice involves intentionally misleading customers with price promotions? Multiple choice question. price fixing predatory pricing price discrimination deceptive pricing

deceptive pricing

A salesperson's goal is to achieve the _______ for which the customer still perceives value. Multiple choice question. minimum sales volume lowest price highest price maximum fair-trade arrangement

highest price

A key benefit of using artificial intelligence (AI) in sales is that ______. Multiple choice question. it can help companies get around government regulations regarding imports, exports, and taxes. it eliminates the need for salespeople to call on their customers in person it can reduce a company's labor budget by eliminating the need for a "live" sales force it allows salespeople to put more time, energy, and resources into building relationships with clients

it allows salespeople to put more time, energy, and resources into building relationships with clients

Which tool allows a company to numerically rate its best prospective customers using software and statistical models? Multiple choice question. prospect hunting meta-analysis financial ratio analysis lead scoring

lead scoring

A firm's goal should be to allocate sales resources to obtain additional customers at _______ cost. Multiple choice question. high zero opportunity low

low

On Wednesdays, many Broadway theaters offer discounted matinee seats for senior citizens and students. All other people pay full price for their seats. This is an example of ______. Multiple choice question. deceptive pricing price discrimination nonprofit fundraising predatory pricing

price discrimination

On Wednesdays, many Broadway theaters offer discounted matinee seats for senior citizens and students. All other people pay full price for their seats. This is an example of ______. Multiple choice question. nonprofit fundraising deceptive pricing predatory pricing price discrimination

price discrimination

The seller's _ cost is the value of what the seller gives up in time and money in pursuing a particular sale.

opportunity

A huge bookstore, World Books, opens in a downtown area. It offers a 50 percent discount on all hardcover books and a 40 percent discount on all paperback books. The other two bookstores in the area cannot possibly compete with such low prices, and they go out of business. It is possible that World Books is engaged in _______. Multiple choice question. predatory pricing deceptive pricing price discrimination price fixing

predatory pricing

The firm's "bottom line" is also known as its

profit

The study of increasing profit through sales is called ______. Multiple choice question. profitology volume loading cost-plus pricing revenue maximization

profitology

The study of increasing profit through sales is called ______. Multiple choice question. revenue maximization volume loading cost-plus pricing profitology

profitology

Which of the following criteria are used in lead scoring? There is more than one correct answer. Multiple select question. sellers' goals prospect behaviors demographic factors buying stage eye and hair color buyers' interests

prospect behaviors demographic factors buying stage buyers' interests

From the following list, select all the examples of variable costs. Multiple select question. rents raw materials sales commissions salaries delivery costs

raw materials sales commissions delivery costs

From the business's perspective, what is a major drawback of pricing products too low? Multiple choice question. poor customer satisfaction reduced revenue decreased word-of-mouth lower sales

reduced revenue

Units sold times price equals ______. Multiple choice question. value markup unit cost revenue

revenue

Using AI in sales can help _______, but AI will never replace salespeople because _______. Multiple choice question. build and cement one-on-one relationships; customers cannot be trusted to use AI systems effectively companies fully automate the sales process from prospecting through closing; AI is much more expensive than human labor costs salespeople manage time-consuming and mundane tasks; play a key role in building trust and driving the sales process eliminate the need for human salespeople; companies fear retaliation from former employees

salespeople manage time-consuming and mundane tasks; play a key role in building trust and driving the sales process

The fastest and most economical way to grow revenue is to _______. Multiple choice question. sell more to an existing client base send manufacturing operations overseas expand an already successful product line develop and market new products

sell more to an existing client base

Which costs are typically included in customer acquisition analysis? Multiple select question. spending on marketing spending on sales spending on legal fees spending on advertising spending on public relations spending on inventory management

spending on marketing spending on sales spending on advertising spending on public relations

Charitable institutions have _______ from recent changes in tax laws regarding the deduction of charitable contributions. Multiple choice question. suffered benefited

suffered

Which of the following are involved in practicing the science of profitology? There is more than one correct answer. Multiple select question. engaging in reverse-engineering outsourcing production and manufacturing tailoring a price to a customer's specific circumstances researching data being aware of industry standards using experience

tailoring a price to a customer's specific circumstances researching data being aware of industry standards using experience

Which of the following is the lowest-cost qualitative research project that an organization can undertake? Multiple choice question. conducting surveys with SurveyMonkey sponsoring questionnaires on social media talking to salespeople conducting focus groups

talking to salespeople

Which of the following is the lowest-cost qualitative research project that an organization can undertake? Multiple choice question. sponsoring questionnaires on social media conducting surveys with SurveyMonkey conducting focus groups talking to salespeople

talking to salespeople

To calculate profit, we subtract ______ from revenue. Multiple choice question. variable costs marginal costs total costs average costs

total costs

Price is a factor in almost every purchase decision that you make. True false

true

Underpricing yourself in the labor market can have a significant long-term effect on your earnings. True false

true

Which two items do we multiply together in order to calculate revenue? Multiple select question. returns units sold inventory cost price

units sold price

Match each term with its definition.

up-selling selling customers a better version of a product they already own cross-selling selling customers a completely new product

Which of the following are involved in practicing the science of profitology? There is more than one correct answer. Multiple select question. using experience engaging in reverse-engineering outsourcing production and manufacturing researching data being aware of industry standards tailoring a price to a customer's specific circumstances

using experience researching data being aware of industry standards tailoring a price to a customer's specific circumstances