mark 3000 ch11 quiz
10) 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) channel partners
Answer: A
19) What is a major advantage of product bundle pricing? A) It can promote the sales of products consumers might not otherwise buy. B) It allows a company to offset the costs of disposing of by-products. C) It combines the benefits of the other pricing strategies. D) It creates a brand experience for consumers. E) It offers consumers less value for the money.
Answer: A
4) 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
Answer: A
1) A company sets not a single price, but rather a ________ that covers different items in its line that change over time as products move through their life cycles. A) pricing by-product B) pricing structure C) pricing loop D) pricing cycle E) pricing bundle
Answer: B
15) HiPoint Telephone Company uses two-part pricing for its long-distance call charges. Because this is a service, the price is broken into a fixed fee plus a(n) ________. A) fixed usage rate B) variable usage rate C) standard usage rate D) market usage rate E) optional usage rate
Answer: B
16) 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) optional product C) captive product D) by-product E) skimming
Answer: B
18) Using product bundle pricing, sellers combine several products and offer the bundle ________. A) as a functional unit B) at a reduced price C) as a complete self-service package D) as a reward to loyal customers E) at a premium price
Answer: B
5) ________ pricing is the approach of setting a low initial price in order to attract a large number of buyers quickly and win a large market share. A) Market-skimming B) Market-penetration C) Below-market D) Value-based E) Leader
Answer: B
8) Companies usually develop ________ rather than ________. A) single products; product families B) product lines; single products C) product families; product lines D) product brands; product images E) product images; product brands
Answer: B
11) Typically, producers who use captive-product pricing set the price of the main product ________ and set ________ on the supplies necessary to use the product. A) low; low markups B) high; low markups C) low; high markups D) high; high markups E) moderately; moderate markups
Answer: C
12) Mach 3 razor blades must be used in the Mach 3 razor. Which type of pricing is being used? A) product line pricing B) optional product pricing C) captive product pricing D) by-product pricing E) product bundle pricing
Answer: C
13) In the case of services, captive product pricing is called ________ pricing. A) by-product B) optional product C) two-part D) bundle E) segmented
Answer: C
14) When amusement parks and movie theaters charge admission plus fees for food and other attractions, they are following a(n) ________ pricing strategy. A) by-product B) optional-product C) two-part D) skimming E) penetration
Answer: C
2) 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) market-skimming pricing D) market-price lining E) market-price filling
Answer: C
20) Which of the following is NOT a price adjustment strategy? A) segmented pricing B) promotional pricing C) free samples D) geographical pricing E) seasonal pricing
Answer: C
6) Which of the following conditions would NOT support the use of a market-penetration pricing strategy? A) The market is highly price sensitive. B) Production and distribution costs will fall as sales volume increases. C) The product's quality and image support a high price. D) A low price would help keep out the competition. E) A and C
Answer: C
17) Using ________, companies are able to turn their trash into cash, allowing them to make the price of their main product more competitive. A) product bundle pricing B) optional product pricing C) captive product pricing D) by-product pricing E) skimming
Answer: D
3) Of the following, which statement(s) would NOT support a market-skimming policy for a new product? A) The product's quality and image support its higher price. B) Enough buyers want the products at that price. C) Competitors are not able to undercut the high price. D) Competitors can enter the market easily. E) C and D
Answer: D
9) A marketer must be familiar with the five major product mix pricing situations. Which of the following is NOT one of them? A) product line pricing B) optional product pricing C) captive product pricing D) unbundled product pricing E) by-product pricing
Answer: D
7) Which of the following is a reason that a marketer would choose a penetration pricing strategy? A) to ensure the company has the ability to increase prices once demand decreases B) to focus on the rapid achievement of profit objectives C) to appeal to different consumer segments with different levels of price sensitivity D) to create markets for highly technical products E) to discourage competition from entering the market
Answer: E