Marketing 205 Chapter 11

Which term refers to prices that buyers carry in their minds and check with when they look at a given product? A) Reference prices B) Product form prices C) Product line Prices D) Time-based prices E) Location-based prices

A) Reference prices

Which of the following is true of the price changes? A) Excess capacity is a factor that causes increase in price B) A drop in price can adversely affect how consumers view the brand C) Customer reaction to price changes is not as important as competitor reaction D) Changes in price do not affect a brand's image E) Over-demand leads to companies initiating price cuts

B) A drop in price can adversely affect how consumers view the brand

The New Age Gallery has three admission prices for students, adults, and seniors, even though all three groups are entitled to the same services. This form of pricing is called ________ pricing. A) Psychological B) Product Form C) Customer-Segment D) Captive Product E) By-Product

C) Customer-Segment

Consumers are less likely to use price to judge the quality of a product when they ________. A) are shopping for luxury items B) Cannot physically examine the product C) Have experience with the product D) Have little knowledge of the brand E) Have never tried the product before

C) Have experience with the product

In response to price cuts from competitors, a cereal company with several more expensive and higher quality cereals introduced a lower-priced option to its product line. This is an example of which of the following responses to a competitor's price cut? A) Raising the perceived value of a product B) Improving product quality C) Launching a "fighter" brand D) Accepting a reduced market share E) Using high-low pricing

C) Launching a "fighter" brand

Midnight Magic., a perfume manufacturing company, plans to release a new fragrance during the holiday season at $99 per bottle. The company intends to bring the price down to $49 within six months of its release to attract buyers who couldn't afford the initial price. Which of the following pricing strategies is Midnight Magic using? A) Product-Line Pricing B) Competitive Pricing C) Market - Skimming Pricing D) Cost - Plus Pricing E) Market - Penetration Pricing

C) Market - Skimming Pricing

A number of top fashion - modeling agencies would most likely be charged with ________ for jointly determining what commissions they charge for models A) Competitive pricing B) Price Bundling C) Prestige Pricing D) Price Fixing E) Dynamic Pricing

D) Price Fixing

Electrowhip, a company that manufacturers blenders and electric whisks, has decided to use a market penetration pricing strategy. Which of the following, if true, proves their decision to be a wise one? A) Electrowhip sells products whose image and quality support high prices B) Electrowhip's products are intended to appeal to the elite in society C) Electrowhip does not operate in a price sensitive market D) Electrowhip's competitors utilize social media for marketing their products E) Electrowhip operates in a market with many competitors

E) Electrowhip operates in a market with many competitors

Which of the following companies uses product bundle pricing? A) Green Thumb, which gives away free watering cans with the purchase of certain potted plants B) Photo Genie, which sells inexpensive cameras that run only on their own, expensive, batteries C) Tune Zone, which launched a range of MP3 player models, each priced according to its features D) Penquin's Parlor, which offers customers a 20% discount on their birthdays E) Panizza, whose combo meals are priced lower than its individual components sold together

E) Panizza, whose combo meals are priced lower than its individual components sold together