Ch. 10

What is the first thing marketers must do when using​ value-based pricing? A. Set the target price to match customer perceived value. B. Assess customer needs and value perceptions. C. Design a quality product. D. Determine product costs. E. Convince buyers that the​ product's value at a given price justifies the purchase.

Assess customer needs and value perceptions.

Which of the following statements is true regarding​ costs? A. Experience curve pricing is a low risk strategy. B. Average cost tends to decrease with accumulated production experience. C. Variable costs vary directly with the level of sales. D. Totals costs are the sum of​ long-run average costs and​ short-run average costs. E. Costs do not vary with different levels of production.

Average cost tends to decrease with accumulated production experience.

Which of the following correctly identifies the three major pricing strategies used by​ marketers? A. Customer valuedash-based ​pricing, cost-based​ pricing, and​ profit-based pricing B. Customer valuedash-based ​pricing, cost-based​ pricing, and​ revenue-based pricing C. Customer valuedash-based ​pricing, revenue-based​ pricing, and​ competition-based pricing D. Customer valuedash-based ​pricing, revenue-based​ pricing, and​ profit-based pricing E. Customer valuedash-based ​pricing, cost-based​ pricing, and​ competition-based pricing

Customer valuedash-based ​pricing, cost-based​ pricing, and​ competition-based pricing

Which of the following is true regarding the pricedash-demand ​relationship? A. Price elasticity measures how responsive price will be to a change in demand. B. If demand is​ elastic, sellers will consider lowering their price. C. If demand is​ inelastic, a small change in price will result in a large change in demand. D. A demand curve shows the number of units a company will produce in a given time period at different prices that might be charged. E. Demand and price are directly relatedlong dash—the higher the​ price, the greater the demand.

If demand is​ elastic, sellers will consider lowering their price.

Which of the following statements regarding customer valuedash-based pricing is​ correct? A. This strategy is seldom used because buyers rarely consider perceived value when evaluating a​ product's price. B. In using this​ strategy, companies often find it hard to measure the value customers attach to their product. C. Using this​ strategy, marketers must convince buyers that the​ product's value at that price justifies its purchase. D. Using this​ strategy, marketers first design the product and marketing​ program, then set the price. E. Customer valuedash-based strategy begins with determining product costs.

In using this​ strategy, companies often find it hard to measure the value customers attach to their product.

Which factor sets the floor on setting a​ product's price? A. Product costs B. Competitors C. Demand D. Revenue E. ​Customer's value perceptions

Product costs

What is target​ costing? A. Setting a price and then setting costs that will ensure that the price is met B. Basing price on customer perceptions of cost C. Setting acceptable costs and then setting the price D. Pricing products without any consideration to costs E. Designing a​ product, then determining its cost and price

Setting a price and then setting costs that will ensure that the price is met

How is price determined using​ cost-plus pricing? A. The price is set by determining the​ customer's value perceptions. B. The price is set by adding a standard​ mark-up to the cost of the product. C. The price is set so that total revenue covers total costs. D. The price is set based on demand. E. The price is set based on​ competitor's prices.

The price is set by adding a standard​ mark-up to the cost of the product.

​A(n) __________ shows the number of units the market will buy in a given time period at different prices. A. demand curve B. value curve C. perceptual map D. supply curve E. production schedule

demand curve

Price is the only part of the marketing mix that​ __________. A. incurs costs B. is defined by the consumer C. produces revenue D. does not play a role in creating customer value E. attracts buyers

produces revenue