Marketing Final

________ pricing involves setting prices based on the expenses involved in producing, distributing, and selling a product plus a fair rate of return for a company's effort and risk.

Cost- based

True or false: unlike the other marketing elements, price plays a minor role in creating customer value and building customer relationships.

False

Which of the following statements about break even analysis is most likely true?

It fails to consider customer value and the relationship between price and demand.

When establishing prices, its important for a manager to understand that "good value" is not the same as ______

Low price

True or false: Dynamic pricing is particularly suitable for Internet-based companies like Amazon who want to be responsive to shoppers desires and marketplace changes

True

True or false: Some companies deemphasize price and use other marketing mix tools to create non-price positions in the marketplace

True

Establishing prices for razor blades that must be used with a razor blade system is known as ________ pricing

captive-product

Which of the following sets the upper limit for a products pricing?

consumer perceptions of value

Lovely Skin is establishing a pricing strategy for a new moisturizer. The total cost to produce each unit is $3.50. The company has decided to add a $1.50 markup, so the unit price to distributors will be $5. Lovely Skin is using a ________ approach to price the new moisturizer.

cost-plus

When demand hardly changes with a small change in the price of a product, then the demand for the product is best described as ________.

inelastic

The first generation Apple iPod was introduced in 2001 and sold for $500. The following year a mini version was introduced for $250. Apple initially used a ____ strategy to price their digital music innovation

market skimming

The first Target store opened in 1962. Its initial strategy was to set prices low to attract a large number of buyers quickly and win a large market share. This is referred to as ________.

market-penetration pricing

_____ is the sum of all values that customers give up to gain the Benefits of having or using a product or service

price

Salon Du Jour offers special combination packages at a reduced price. Separately, a haircut is $30 and a conditioning treatment is $35. But the combo price is $50. This is referred to as ________ pricing.

product bundle

A _____ pricing strategy for an offering begins with an assessment of customer needs and perceptions. Then a target price is set based on customer perceptions of worth

value-based