marketing test 5

20 stores specialize and sell same product on 1 street. an individual seller can't charge more than going rate, what type of market is this? A.) pure competition B.) monopolistic C.) oligopolistic D.) pure monopoly E.) socialist

A

______ describes how responsive demand will be to a change in price A.) price elasticity B.) break even pricing C.) break even chart D.) target costing E.) supply

A

______ uses buyers perceptions of what a product is worth, not the sellers cost, as the key to pricing A.) value based pricing B.) target return pricing C.) variable costs D.) price elasticity E.) product image

A

a challenge for management in product line pricing is to decide on the price steps between the A.) various products in a line B.) product mixes C.) product groupings D.) product lines E.) various target markets

A

a company should set prices that will allow _____ to receive a fair profit A.) resellers B.) producers C.) consumers D.) the elderly E.)competitors

A

a firm is using _____ when it charges a high, premium price for a new product with the intention of reducing the price in the future A.) price skimming B.) trial pricing C.) value pricing D.) market penetration pricing E.) prestige pricing

A

by definition, this type of pricing is used when a firms sells a product or service at two or more prices, even though the difference in price is not based on differences in cost A.) segmented pricing B.) variable pricing C.) flexible pricing D.) cost plus pricing E.) reference pricing

A

costs that do not vary with production or sales level are referred to as ______ costs. A.) fixed B.) variable C.) target D.) total E.) unit

A

price is the only element in the marketing mix that produces? A.) revenue B.) variable costs C.) expenses D.) fixed costs E.) stability

A

price setting is usually determined by _____ in small companies A.) top management B.) marketing departments C.) sales departments D.) divisional managers E.) cross functional teams

A

rent., electricity, and executive salaries are examples of _____ costs A.) fixed B.) variable C.) total D.) accumulated E.) marketing

A

the relationship between the price charged and the resulting demand level can be shown as the _____ A.) demand curve B.) variable costs C.) target costs D.) break even chart E.) experience curve

A

the sherman, clyaton, and robinson_patman acts are all federal laws that were enacted to curb the formation of A.) monopolies B.) oligopolies C.) competitive markets D.) international markets E.) limited partnerships

A

trade or functional discounts are offered by manufacturers to which of the following? A.) channel members who preform tasks that the manufacturer would otherwise have to preform B.) consumers who earn a price reduction for buying in bulk C.) intermediaries such as financing institutions as a cost of doing business with them D.) manufactures that agree to exclusive distribution contracts E.) the government market and other organizations that require bid proposals

A

under _____, the market consist of many buyers and sellers trading in a uniform commodity such as wheat, copper, or financial securities A.) pure competition B.) monopolistic competition C.) oligopolistic competition D.) a pure monopoly E.) anti-trust agreements

A

underpriced products sell very well but they produce less revenue than they would have if price were raised to the ______ level A.) perceived value B.) value based C.) variable D.) demand curve E.) price floor

A

when a manufacturer offers a ______, customers buy products from manufacturers dealers within a specified time period and the manufacturer sends the customer a check A.) cash rebate B.) special event price C.) dealer reduction D.) promotional pricing reward E.) discount allowance

A

when companies set prices, the government and social concerns are two _____ affecting pricing decisions A.) external factors B.) internal factors C.) economic conditions D.) demand curve E.) temporary influences

A

when tv prices at set a price levels they are using A.) product line pricing B.) market skimming C.) market penetration D.) break even E.) target return

A

which of the following is a reason for a company to raise its prices? A.) to address the uses of over demand for a product B.) to win a larger share of the market C.) to use excess capacity D.) to boost sales volume E.) to balance out decreasing costs

A

In ______, price is considered along with the other marketing mix variables before the marketing program is set A.) target return pricing B.) value return pricing C.) variable costs D.) price elasticity E.) cost based pricing

B

_____ prices are the prices that a buyer carries in his or her mind and refers to when looking at a given product A.) psychological B.) reference C.) promotional D.) geographical E.) dynamic

B

_____ pricing is the approach of setting a low initial price in order to attract a large number of buyers quickly and win a target market share A.) market skimming B.) market penetration C.) below market D.) value based E.) leader

B

a company faces fixed costs of 100000 and variable costs of 8 per units and plan to sell directly to market for 12. how many units do they need to produce to see and break even? A.) 20,000 B.) 25,000 C.) 40,000 D.) 50,000 E.) i dont know

B

a company sets not a single price but rather a _____ that covers different items in its line that change over time as product move through their life cycles A.) pricing by product B.) pricing structure C.) pricing loop D.) pricing cycle E.) pricing bundle

B

a quantity discount is a price reduction to buyers who purchase A.) frequently B.) large volumes C.) close outs D.) inferior merchandise E.) superior merchandise

B

break even pricing or a variation called _______, is when the firm tries to determine the price at which it will break even or make the profit it is seeking A.) competition based pricing B.) target return pricing C.) fixed costs D.) value based pricing E.) customer based pricing

B

companies involved in deciding which items to include in the base price and which to offer as options are engaged in ______ pricing A.) product bundle B.) option product C.) captive product D.) by product E.) skimming

B

consumers usually perceive higher priced products as A.) not within reach of most people B.) having a higher quality C.) having high profit margins D.) popular brands E.) being in the introductory stage of the products life cycle

B

costs that vary directly with the level of production are referred to as _____ costs A.) fixed B.) variable C.) target D.) total E.) unit

B

each of the following economic factors can have a strong impact on a firms pricing strategy EXCEPT A.) an economic boom B.) resellers reaction to price changes C.) economic recession D.) inflation E.) interest rates

B

federal legislation on price fixing requires that sellers set their prices A.) based on their fixed and variable costs B.) without communication with competitors C.) to achieve a specified profit margin D.) with the intention of putting competitors out of business E.) consistently throughout a region

B

hotline long distance services uses captive product pricing for its phone call charges. because this is a service, the price is broken into a fixed rate plus a per call A.) fixed rate usage B.) variable usage rate C.) standard usage rate D.) market usage rate E.) fixed fee

B

if a camera company follows a high price, high margin strategy what will the competitor do? A.) go out of business B.) compete by undercut C.) advertise less D.) unbundle products E.) market skimming pricing

B

if demand hardly changes with a small change in price, we say the demand is ____ A.) variable B.) inelastic C.) value based D.) break even pricing E.) market penetrating

B

market skimming pricing would likely be most effect in selling A.) any convince item B.) electronic device for which R&D must be recouped C.) anything easily copied by competitors D.) most items at walmart

B

price escalation in international markets is most likely to result from the higher costs of selling in another country and differences in market conditions or A.) cultural preferences B.) selling strategies C.) regional tastes D.) customer perceptions E.) language barriers

B

the fact that a hot dog cost 5 times more at disney world than sam club is an example of A.) allowance B.) captive product C.) segmented D.) promotional E.) penetration

B

the internet offers _____ where the price can easily be adjusted to meet changes in demand A.) captive B.) dynamic C.) basing point D.) price bundling E.) cost plus

B

they want to introduce a new boat with mature markets in a highly developed country hoping to gain of quick mass market share. what pricing strategy do you use? A.) market skimming B.) market penetration C.) zone D.) discount E.) captive product

B

under _____ the market consists of many buyers and sellers who trade over a range of prices rather than a single market price A.) pure competition B.) monopolistic conception C.) oligopolistic competition D.) pure monopoly E.) socialism

B

when pepsi came out with pepsi blue and priced it half price to attract buyers, this was A.) market skimming B.) market penetration C.) new product D.) discount E.) promotional allowances

B

when there is price competition, many companies adopt _____ rather than cutting prices to match competition A.) pricing power B.) value added pricing strategies C.) fixed costs D.) price elasticity E.) image pricing

B

when using price steps, the seller must establish perceived _____ that support the price differences among the products in the line A.) nonprice competition B.) value differences C.) quantity levels D.) images E.) startegies

B

which of the following is NOT a reason for a company to initiate a price cut? A.) to boost sales B.) to obtain prestige C.) to dominate the market D.) to relieve excess capacity E.) to influence falling demand

B

which of the following is an external factor that affects pricing decisions? A.) the salaries of a product manager B.) competition C.) overal pricing objectives D.) the salaries of finance management E.)the company overall marketing strategy

B

with an understanding of price elasticity, sellers should know that the less elastic the demand for their product is, the more advantageous it is for them to A.) drop the price B.) raise the price C.) leave the price where it is D.)discontinue the item E.) bundler the product with another one

B

with product bundle pricing sellers can combine several products and offer the bundle A.) as a working unit B.) at a reduced price C.) as a complete self service package D.) as a reward to loyal customers E.) as segmented pricing

B

____ is the amount of money charged for a product or service? A.) experience curve B.) demand curve C.) price D.) wage E.) salary

C

_____ pricing involves setting prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for the company efforts and risks A.) value based B.) fixed costs C.) cost based D.) variable E.) skimming

C

_______ that influence pricing decisions include the nature of the market and demand A.) internal factors B.) elasticity factors C.) target factors D.) domestic factors

C

all of the following conditions support market penetration pricing EXCEPT which one? A.) the market must be highly price sensitive B.) production and distribution cost must fall as sales volume increases C.) the products quality and image must support the price D.) the low price must help keep out the competition E.) a low price will produce more market growth

C

big mikes food store sells nutrionaly food and prices varies according to individual accounts. what strategy is this? A.) promotional B.) cost plus C.) dynamic D.) value E.) penetration

C

companies facing the challenge of setting prices for the first time can choose between two broad strategies: market penetration pricing and A.) market level pricing B.) market competitive pricing C.) marketing skimming pricing D.) market price lining E.) market price filing

C

customers us prices less to judge the quality of a product when they A.) lack information B.) lack skills to use the product C.) have experience with the product D.) are shopping for a specialty item E.) cannot physically examine the product

C

if demand changes greatly with a small change in price, we say the demand is A.) inelastic b.) variable C.) elastic D.) value based E.) fixed

C

it is most typical for producers who use captive pricing to set the price of the main product ____ and set ____ on the supplies necessary to use the product A.) low, low mark ups B.) high, low mark ups C.) low, high mark ups D.) high, high mark ups E.) moderately, moderate markups

C

mach 3 razor blades must be used for mach 2 razor what pricing is this? A.) product line B.) optional product C.) captive product D.) by product E.) allowance

C

measuring _____ can be difficult. a company might conduct surveys or experiments to test this in the different products they offer A.) target returns B.) fixed costs C.) perceived value D.) break even pricing E.) variable costs

C

price discrimination is legal under which conditions A.) when a manufacturer and reseller have agreed upon a specified retail price for a product B.) manufacturer sells to retails in different markets C.) if seller can prove costs per unit are different when selling to different retailers D.) if seller advertise prices that are not actually available to customers E.) if seller has not communicated with competitors before announcing prices

C

products cost set a _____ to a products price A.) demand curve B.) experience curve C.) floor D.) ceiling E.) break even costs

C

savings for you is highly competitive and cuts prices real deep when entering a new market. it is at risk for A.) market skimming B.) pricing fixing C.) predatory D.) deceptive E.) price confusion

C

swatch surveyed the market and identified an unserved segment of watch buyers. using these results, they created a watch at a price consumers were willing to pay. the unorthodixed order of this is A.) competition based B.) cost plus C.) target D.) value based E.) pentration

C

the company designs what it considers to be a good product, totals the expenses of making the product and sets that price that adds a standard mark up to the costs of the product. this approach to pricing is called ____ pricing. A.) value based B.) fixed costs C.) variable D.) skimming

C

the new age gallery has different admission prices for students, adults, and seniors. all three groups are entitled for the same service. this form of pricing is called ____ A.) time based B.) location C.) customer segment D.) revenue management E.) generational

C

the simplest pricing method is A.) value based pricing B.) going rate and sealed bid pricing C.) cost plus pricing D.) break even analysis E.) target return pricing

C

under _____ market consists of few sellers who are highly sensitive to each others pricing and marketing strategies A.) pure competition B.) monopolistic C.) oligopolistic D.) pure monopoly E.) capitalism

C

under which type of geographic strategy does each customer pay the exact freight for the product from the factory to its destination A.) base point B.) freight absorption C.) FOB origin D.) dynamic E.) zoning

C

value based pricing in the reverse process of _____ pricing A.) variable costs B.) cost plus C.) cost based D.) good value E.) value added

C

when a competitor cuts its prices, a company might decide to ____ if it believes it will not lose much market share or would lose too much profit by cutting its own price A.) reduce its probation costs B.) reduce its marketing costs C.) maintain its current price and profit margin D.) increase its marketing budget to raise the perceived value of its product E.) increase its production costs to improve the quality of the product

C

when amusement parks and movie theaters charge admission plus fees for food and other attractions they are following ___ pricing strategy A.) by product B.) optional product C.) captive product D.) skimming E.) penetration

C

which is cost based approach to pricing A.) value based pricing B.) going rate pricing C.) break even pricing D.) good value pricing E.) A and C

C

which of the following is the opposite of FOB origin pricing A.) basing point B.) freight absorption C.) uniform delivered D.) freight absorption E.) zone

C

____ involves changing a constant low price with few or no temporary price discounts. A.) high low pricing B.) target return pricing C.) cost plus pricing D.) everyday low pricing (EDLP) E.) penetration pricing

D

______ are the sum of the _____ and _____ for any given level or production A.) fixed costs, variable, total costs B.) fixed costs, total, variable costs C.) variable, fixed, total D.) total, fixed, variable l E.) break even, fixed, total

D

a company would be least likely to set prices low to? A.) prevent competition from entering the market B.) stabilize the market C.) create excitement for a product D.) prepare for an easy exit from a market E.) match a competitor

D

consumer perceptions of the products value set the ______ for prices A.) demand curve B.) floor C.) variable costs D.) ceiling E.) image

D

fixed costs _____ as the number of unites produced increases A.) decrease B.) increase C.) divide in half D.) remain the same E.) increase at a diminishing rate

D

what type of pricing is being used when a company temporarily prices its products below the list price or even below cost to create buying excitement and urgency A.) segmented B.) psychological C.) referent D.) promotional E.) dynamic

D

when a firm varies its price by the season, month, day, hour, its using A.) revenue management B.) penetration C.) skimming D.) time based E.) value added

D

when general motors provides payment for price reductions to its new car dealer as rewards for participating in advertising and sales support programs, its granting A.) trade discounts B.) function discounts C.) allowance D.) promotional allowance E.) trade credit

D

which of the following is NOT on an effective action that a company can take to combat a competitors price cit on a product? A.) reduce price B.) raide perceived value C.) improve quality and increase price D.) bundle products together E.) launch a low price "fighting brand"

D

which of the following presents the strongest reason that markup pricing generally does NOT make sense? A.) sellers earn a fair return on their investment B.) by tying the price to cost, sellers simply pricing C.) when all the firms in the industry using this pricing method, priced tend to be similar D.) this method ignores demand E.) with a standard markup , consumers known when they are being overcharged

D

which of the following would NOT support a market skimming policy for a new product? A.) the products quality and image must support its higher prices B.) enough buyers must want the products at that price C.) competitors are not able to undercut the high price D.) competitors can enter the market easily E.) the cost of producing a smaller volume is not so high that it negates the advantage of charing more per unit

D

with _____ pricing, price is set to match consumers perceptions of product value A.) value costs B.) cost plus C.) cost based D.) value based E.) every day low

D

you get a used vacuum regardless of condition when you buy a new vacuum or sewing machine this reduces price so what discount is this? A.) functional B.) captive product C.) seasonal D.) trade in E.) by product

D

general motors prices its automobiles to achieve 15-20% profit on investment. this is called A.) value based B.) going rate C.) cost plus D.) low price E.) target return

E

price setting is usually determine by ______ in large companies A.) top management B.) divisional managers C.) product line managers D.) purchasing departments E.) both B and C

E

which is true about a break even chart is true? A.) it is used to determine how the customer perceived value changes with value added pricing B.) it is a tool to calculate fixed costs C.) it is the level of earnings a company has during an accounting period D.) it is a tool marketers use to examine the relationship between supply and demand E.) it used variable costs, the unit price, and fixed costs

E

with target costing, marketers will first ____ and then _____ A.) build the marketing mix, identity the target market B.) identify the target market, build the marketing mix C.) design the product, determine its cost D.) use skimming pricing, use penetrating pricing E.) determine a selling price, target cost to ensure that the price is met

E