MKTG 409 Chapter 19

Price is a key element in the marketing mix because it relates directly to the generation of total _____. a. elasticity of demand b. revenue c. market share d. profits e. price competition

b. revenue

ACME Corp. and Spacely Inc. are engaged in intense price competition in order to boost market share of their widgets. This is best described as _____. a. nonprice competition b. a price war c. bartering d. elasticity of demand e. price discrimination

b. a price war

Which of the following is a major advantage of nonprice competition? a. building market share b. fostering a price-conscious mindset c. fostering a value-conscious mindset d. building customer loyalty toward the brand e. exceeding the breakeven point

d. building customer loyalty toward the brand

Maria is concerned about both price and quality of a product. Marketers would best describe her as which of the following? a. utility-sensitive b. prestige-sensitive c. price-obsessed d. price-conscious e. value-conscious

e. value-conscious

Which of the following is calculated by dividing the variable costs by the number of units produced? a. average variable cost b. marginal cost c. average total cost d. break-even point. e. average fixed cost

a. average variable cost

To compete effectively on a price basis, a firm should ____. a. be the low-cost seller of the product b. have the lowest market share c. have the highest quality d. have the highest market share e. be the high-cost seller of the product

a. be the low-cost seller of the product

A price developed in the buyer's mind through experience with the product is a(n) _____. a. internal reference price b. break-even point c. trade discount d. experience price e. external reference price

a. internal reference price

ACME Corp.'s widgets have elastic demand. If ACME raises the price of widgets, what will be the result? a. an increase in market share b. a decrease in total revenue c. a decrease in market share d. a decrease in product inventory e. an increase in total revenue

b. a decrease in total revenue

ACME Corp. offers a price discount to encourage prompt payment. Which of the following is it likely to use? a. quantity discount b. cash discount c. seasonal discount d. trade discount e. allowance

b. cash discount

Which of the following charges the same price to all customers regardless of geographic location, and the price is based on average shipping costs for all customers? a. zone pricing b. uniform geographic pricing c. base-point pricing d. F.O.B. destination pricing e. freight absorption pricing

b. uniform geographic pricing

Which of the following is the point at which the costs of producing a product equals the revenue made from selling the product? a. fixed cost b. marginal revenue c. break-even point d. marginal cost e. demand curve

c. break-even point

The Federal Trade Commission is investigating ACME Corp. for using misleading price tags at its outlet stores to deceive customers into believing they are getting a bargain on Wile E. branded items. Which of the following does the FTC believe ACME is guilty of? a. price fixing b. nonprice competition c. deceptive pricing d. price competition e. price discrimination

c. deceptive pricing

A business's rental of production space is an example of a _____. a. marginal cost b. total cost c. break-even point d. fixed cost e. variable cost

d. fixed cost

Spacely Inc.'s sprockets have inelastic demand. If Spacely raises the price of sprockets, what will be the result? a. a decrease in product inventory b. an increase in market share c. a decrease in market share d. a decrease in total revenue e. an increase in total revenue

e. an increase in total revenue

Which of the following pass on to a business customer the cost savings gained through economies of scale a. allowances b. cash discounts c. trade discounts d. seasonal discounts e. quantity discounts

e. quantity discounts

Which of the following shows the quantity of products a firm expects to sell at various prices if other factors remain constant? a. marginal analysis b. demand line c. demand curve d. reference price e. break-even point

c. demand curve

Which of the following is NOT one of the factors that influence the assessment of value? a. motivations to use available information about prices b. time constraints c. elasticity of demand d. perceived quality e. price levels

c. elasticity of demand