Marketing Ch 14 and 15

10. (p. 380) Wholesaler refers to A. an intermediary who sells to other intermediaries, usually to retailers; usually in consumer markets. B. independent firms or individuals whose principal function is to bring buyers and sellers together. C. any intermediary who takes ownership of a manufacturer's goods or services and then finds multiple buyers for those goods or services. D. a manufacturer's paid representative and acting voice in initial sales transactions. E. a manufacturing "match-maker" who actively seeks out potential buyers and brings them to the manufacturer; if a "match" is made, the agent receives a fixed fee.

A. an intermediary who sells to other intermediaries, usually to retailers; usually in consumer markets.

42. (p. 347) Skimming pricing is considered to be a __________ approach to pricing. A. demand-oriented B. cost-oriented C. profit-oriented D. competition-oriented E. service-oriented

A. demand-oriented

43. (p. 347) Penetration pricing is considered to be a __________ approach to pricing. A. demand-oriented B. cost-oriented C. profit-oriented D. competition-oriented E. service-oriented

A. demand-oriented

188. (p. 393) The density of distribution whereby a firm tries to place its products or services in as many outlets as possible is referred to as __________. A. intensive distribution B. extensive distribution C. selective distribution D. exclusive distribution E. concentrated distribution

A. intensive distribution

94. (p. 350) Rather than billing clients by the hour, some lawyers and their clients agree on a fixed fee oriented on expected costs plus a profit for the law firm. Which pricing method are they using? A. Target pricing B. Cost-plus pricing C. Customary pricing D. Experience curve pricing E. Bundle pricing

B. Cost-plus pricing

102. (p. 350-351) Experience curve pricing refers to A. the method of pricing where price often rises following the reduction of costs associated with the firm's producing and selling an increased volume of the product. B. a method of pricing based on the learning effect, which holds that the unit cost of many products and services declines by 10 percent to 30 percent each time a firms experience at producing and selling them doubles, resulting in possible rapid price reductions. C. the point at which profits double then double again as more consumers become familiar with the product. D. a predictive plan for pricing based upon the knowledge the prices will fluctuate, within any given industry, in a somewhat regular pattern. E. a pricing strategy that uses price estimates based upon the consensus of the most experienced members of the management team.

B. a method of pricing based on the learning effect, which holds that the unit cost of many products and services declines by 10 percent to 30 percent each time a firms experience at producing and selling them doubles, resulting in possible rapid price reductions.

226. (p. 397) Vertical conflict refers to A. conflict that occurs between two members of in the same level of a marketing channel. B. conflict that occurs between two different levels in a marketing channel. C. conflict between members of upper management who make the decisions and lower management who must deal with the daily logistics of the product. D. conflict between management goals and corporate and shareholder goals. E. conflict between two producers of the same product vying for limited distribution channel members.

B. conflict that occurs between two different levels in a marketing channel.

224. (p. 397) The two types of channel conflict are A. divisional and organizational. B. horizontal and vertical. C. transactional and transformational. D. external and internal. E. supervisor-subordinate and subordinate-subordinate.

B. horizontal and vertical.

17. (p. 380) Distributor refers to A. an intermediary who sells only to manufacturers. B. intermediaries who perform a variety of distribution functions, including selling, maintaining inventories, extending credit, and so on. C. a manufacturer's paid representative and acting voice in initial sales transactions. D. an intermediary who sells to other intermediaries, usually to retailers. E. an intermediary who takes possession of a product, alters it in some way, and sells it to the ultimate consumer.

B. intermediaries who perform a variety of distribution functions, including selling, maintaining inventories, extending credit, and so on.

2. (p. 380) Individuals and firms involved in the process of making a good or service available for use or consumption by consumers or industrial users are referred to as a A. line of distribution. B. marketing channel. C. delivery consortium. D. allocation channel. E. distribution mix.

B. marketing channel.

24. (p. 347) The pricing strategy that is almost the exact opposite of skimming pricing is A. target pricing. B. penetration pricing. C. price lining. D. odd-even pricing. E. prestige pricing.

B. penetration pricing.

262. (p. 363) A conspiracy among firms to set prices for a product is referred to as A. price discrimination. B. price fixing. C. predatory pricing. D. tying arrangements. E. exclusive dealing

B. price fixing.

140. (p. 390) The term vertical marketing systems refers to A. professionally managed geographically dispersed marketing channels designed to achieve channel economies and maximize marketing impact. B. professionally managed and centrally coordinated marketing channels designed to achieve channel economies and maximum marketing impact. C. retailer-sponsored cooperatives where small, independent retailers form an organization that operates a wholesale facility cooperatively. D. professionally managed geographically dispersed marketing channels that are controlled through strategic channel alliances. E. channel partnerships that share responsibility for ordering and physically distributing each other's goods.

B. professionally managed and centrally coordinated marketing channels designed to achieve channel economies and maximum marketing impact.

120. (p. 352) Target return-on-investment (ROI) is frequently used by A. contractors. B. public utilities. C. business-to-business markets. D. supermarkets. E. small privately owned firms.

B. public utilities. Large, publicly owned corporations and many public utilities set annual return-on-investment (ROI) targets such as a ROI of 20 percent. Target return-on-investment pricing is a method of setting prices to achieve this target.

14. (p. 346) Skimming pricing refers to A. setting the lowest initial price possible when introducing a new or innovative product in order to "skim" sales from competitors. B. setting the highest initial price that customers really desiring the product are willing to pay, when introducing a new or innovative product. C. setting the lowest initial price possible, skimming right above the point of profitability, in order to secure a larger market share. D. purposely setting the highest price possible to repel the mass market and cultivate upper echelon buyers even though the actual value of the item is extremely small. E. selling off the lowest producing products from a company's product line and turning them over to resellers to skim off any remaining profit potential.

B. setting the highest initial price that customers really desiring the product are willing to pay, when introducing a new or innovative product.

60. (p. 383) A commonly used indirect channel moves product from producer to retailer to consumer. This channel is used when the retailer is large and can buy in large quantities from a producer or when A. the cost of maintaining inventory is low. B. the cost of inventory makes it too expensive to use a wholesaler. C. there is little if any seasonal demand. D. the risk lies solely with the manufacturer. E. the retail outlets are regionally located.

B. the cost of inventory makes it too expensive to use a wholesaler.

156. (p. 390) A contractual vertical marketing system refers to A. when privately owned distributors and retailers integrate their efforts, on a contractual basis, to obtain greater functional economies and marketing impact than they could achieve alone. B. the integration of independent production and distribution firms, on a contractual basis, so their efforts to obtain greater functional economies and marketing impact are greater than they could achieve alone. C. when a manufacturer offers a limited number of franchise licenses to guarantee the numbers of company competitors within a given geographical region. D. an arrangement whereby a firm reaches different buyers by employing two or more different types of channels for the same basic product. E. the formal contractual designation of one channel member whether producer, wholesaler, or retailer, to coordinate, direct, and support all other members.

B. the integration of independent production and distribution firms, on a contractual basis, so their efforts to obtain greater functional economies and marketing impact are greater than they could achieve alone.

267. (p. 364) Controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price are referred to as A. horizontal price fixing. B. vertical price fixing. C. competitive price fixing. D. independent price fixing. E. explicit price fixing.

B. vertical price fixing.

274. (p. 364) A unique feature of the Robinson-Patman Act is that allows for price differentials to different customers under several conditions. Which of the following practices would be permitted? A. Using price differentials when price differences are given on the basis of other family businesses B. Using price differentials when charging different prices to different buyers for goods of like grade or quality C. When price differences are quoted to selected buyers in good faith to meet competitors' prices and are not intended to injure competition D. Using price differentials when charging different prices on the basis of religious affiliation E. Using price differentials when charging the original price for goods that have been damaged but repaired according to company specifications

C. When price differences are quoted to selected buyers in good faith to meet competitors' prices and are not intended to injure competition

13. (p. 380) An intermediary who sells to consumers is referred to as a(n) __________. A. agent B. broker C. retailer D. wholesaler E. distributor

C. retailer

200. (p. 394) The density of distribution whereby a firm tries to place its products in a few retail outlets in a specific geographical area is referred to as __________ distribution. A. intensive B. extensive C. selective D. exclusive E. concentrated

C. selective

23. (p. 347) Penetration pricing refers to A. charging different prices to different buyers for goods of like grade and quality. B. setting the highest initial price that customers really desiring the product are willing to pay. C. setting a low initial price on a new product to appeal immediately to the mass market. D. setting a market price for product or product class oriented on a subjective feel for the competitors' price or market price as the benchmark. E. setting prices a few dollars or cents under an even number.

C. setting a low initial price on a new product to appeal immediately to the mass market.

55. (p. 349) Odd-even pricing refers to A. setting prices one way for product lines and another way for individual brands. B. setting prices of luxury items at even price points and setting the price of necessities at odd price points. C. setting prices a few dollars or cents under an even number. D. adding a fixed percentage to the cost of all items in a specific product class. E. offering retailers "baker's dozens," thirteen items for the price of twelve to encourage larger purchase orders.

C. setting prices a few dollars or cents under an even number.

92. (p. 350) Cost-plus pricing refers to A. setting the price of a line of products at a number of different price points. B. adding a fixed percentage to the cost of all items in a specific product class. C. summing the total unit cost of providing a product or service and adding a specific amount to the cost to arrive at the price. D. setting prices to achieve a profit that is a specified percentage of the sales volume. E. increasing the price slightly to protect against undue profit losses from unforeseen environmental factors.

C. summing the total unit cost of providing a product or service and adding a specific amount to the cost to arrive at the price.

60. (p. 349) A method of (1) estimating the price that ultimate consumers would be willing to pay for a product, (2) working backward through markups taken by retailers and wholesalers to determine what price to charge wholesalers, and (3) deliberately adjusting the composition and features of the product to achieve the target price to consumers, is referred to as __________. A. cost-sensitivity pricing B. cost-plus percentage-of-cost pricing C. target pricing D. cost-plus fixed-fee pricing E. customer dominated pricing

C. target pricing Target pricing is a method of estimating the price that ultimate consumers would be willing to pay for a product, working backward through markups taken by retailers and wholesalers to determine what price to charge wholesalers, and then deliberately adjusting the composition and features of the product to achieve the target price to consumers.

285. (p. 365) This practice may exist when a buyer is offered "1-Cent Sales," "Buy 1, Get 1 Free," and "Get 2 for the Price of 1." Such pricing is legal only if A. the seller is using bundle pricing. B. there is a reasonable amount of stock to satisfy the needs of the retailers normal traffic flow. C. the first items are sold at the regular price, not a price inflated for the offer. D. the product are not outdated, and if they are, they must be marked as such. E. the quantity available to the customer is not limited.

C. the first items are sold at the regular price, not a price inflated for the offer.

269. (p. 364) Price discrimination refers to A. an arrangement a manufacturer makes with a reseller to handle only its products and not those of a competitor. B. the practice of charging a very low price for a product with the intent of driving competitors out of business. C. the practice of charging different prices to different buyers for goods of like grade and quality. D. a conspiracy among firms to set prices for a product or service. E. a seller's requirement that the purchaser of one product also buy another product in the line.

C. the practice of charging different prices to different buyers for goods of like grade and quality.

16. (p. 346) A skimming pricing policy is likely to be most effective when (1) customers are willing to buy immediately at the high initial price; (2) lowering the price has only a minor effect on increasing sales volume and reducing unit costs; (3) when the high initial prices do not attract competitors; and (4) A. consumers perceive your product to be similar to other products on the market. B. a lower price will significantly reduce unit costs. C. when customers interpret high price as signifying high quality. D. consumers tend to be price sensitive. E. it will be easier to set measureable sales unit goals.

C. when customers interpret high price as signifying high quality.

27. (p. 347) Which of the following statements about penetration pricing is most accurate? A. Penetration pricing is a profit-oriented approach to pricing. B. Penetration pricing is a cost-oriented pricing method. C. Penetration pricing encourages competitors to enter a market. D. A penetration pricing strategy is more effective in a marketplace with price-sensitive consumers. E. Because penetration pricing is a high initial-price strategy, it will not attract competitors.

D. A penetration pricing strategy is more effective in a marketplace with price-sensitive consumers.

49. (p. 348) The assumption that demand is elastic at a number of price points but is inelastic between these price points leads to which approach to pricing? A. Target pricing B. Skimming pricing C. Penetration pricing D. Price lining E. Odd-even pricing

D. Price lining

193. (p. 393) A level of distribution density whereby only one retailer in a geographical area carries the firm's products is referred to as __________. A. intensive distribution B. extensive distribution C. selective distribution D. exclusive distribution E. concentrated distribution

D. exclusive distribution

19. (p. 380) Intermediaries make the selling of goods more efficient by A. eliminating inventory costs. B. identifying target markets. C. reducing manufacturing costs. D. minimizing the number of sales contacts between producer and consumer. E. maximizing the number of contacts necessary between producer and consumer.

D. minimizing the number of sales contacts between producer and consumer.

70. (p. 349) Yield management pricing refers to A. controlling the production of goods based upon seasonal demand. B. deliberately selling a product below its customary price, not to increase sales, but to attract customers' attention in hopes that they will buy other products as well. C. deliberately selling a product below its customary price, not to increase sales, but to attract customers' attention in hopes that the strategy will yield a large portion of the competitor's market share. D. offering significant price discounts to wholesalers who agree to purchase products in advance for a period of a year or more at a time. E. charging different prices to maximize revenue for a set amount of capacity at any given time.

E. charging different prices to maximize revenue for a set amount of capacity at any given time.

97. (p. 350) The most commonly used pricing method for business products is __________. A. target return on investment B. customary C. standard markup D. target profit E. cost-plus pricing

E. cost-plus pricing

78. (p. 349) With cost-oriented approaches a price setter stresses the __________ side of the pricing problem, not the __________ side. A. cost; revenue B. cost; profit C. cost; service D. cost; supply E. cost; demand

E. cost; demand

26. (p. 381) The three basic functions performed by intermediaries are A. accommodating functions, logistical functions, and transactional functions. B. implementation functions, accommodating functions, and contractual functions. C. contractual functions, facilitating functions, and logistical functions. D. facilitating functions, accommodating functions, and implementation functions. E. transactional functions, logistical functions, and facilitating functions.

E. transactional functions, logistical functions, and facilitating functions.

55. (p. 382) When Dell Computer sells made-to-order PCs via its Web site, it is an example of which type of marketing channel? A. Direct channel B. Indirect channel C. Strategic channel alliances D. Marketing channel E. Dual distributive channel

A. Direct channel

107. (p. 352) Which of the following is a profit-oriented pricing method? A. Target return on sales B. Loss leader C. Above-, at-, or below market D. Price lining E. Penetration pricing

A. Target return on sales

4. (p. 346) Key to setting a final price for a product is to find an approximate price level to use as a reasonable starting point. Four common approaches to helping find this approximate price level are (1) demand oriented, (2) __________, (3) profit-oriented, and (4) competition-oriented approaches. A. cost-oriented B. cause-oriented C. revenue-oriented D. reduced risk-oriented E. multi-pricing oriented

A. cost-oriented

7. (p. 380) A(n) __________ is any intermediary between manufacturer and end-user markets. A. middleman B. wholesaler C. retailer D. agent E. broker

A. middleman

118. (p. 352) Setting a price to achieve an annual target return-on-investment (ROI) is referred to as A. target return-on-investment pricing. B. target return-on-profit pricing. C. target return-on-sales pricing. D. target revenue pricing. E. customary pricing.

A. target return-on-investment pricing

198. (p. 393) For which of the following products would the manufacturer be most likely to use exclusive distribution? A. Timex watches, Hanes underwear, and Nike shoes B. Chanel perfume, Steinway pianos, and Baccarat crystal C. Oreos, Teddy Grahams, and NillaWafers D. Paper clips, light bulbs, and file folders E. Lean Cuisine meals, Breyer's ice cream, and Coca-Cola

B. Chanel perfume, Steinway pianos, and Baccarat crystal

145. (p. 390) The three major types of corporate vertical marketing systems are corporate, contractual, and __________. A. integrated B. administered C. cooperative D. delegated E. manufacturer-dominated

B. administered

8. (p. 380) Any intermediary with legal authority to act on behalf of the manufacturer is referred to as a A. dealer. B. agent. C. retailer. D. wholesaler. E. distributor.

B. agent.

143. (p. 390) The combination of successive stages of production and distribution under a single ownership is referred to as a(n) __________. A. contractual vertical marketing system B. corporate vertical marketing system C. integrated marketing system D. corporate horizontal marketing system E. contractual horizontal marketing system

B. corporate vertical marketing system

80. (p. 349) Standard markup is considered to be a __________ approach to pricing. A. demand-oriented B. cost-oriented C. profit-oriented D. competition-oriented E. service-oriented

B. cost-oriented

87. (p. 350) Experience curve pricing is considered to be a __________ approach to pricing. A. demand-oriented B. cost-oriented C. profit-oriented D. competition-oriented E. service-oriented

B. cost-oriented

57. (p. 349) Odd-even pricing is most closely related to A. retailers' perceptions of price. B. customers' perceptions of price. C. wholesalers' markups. D. manufacturers' costs. E. cost-of-product facilitation-to-market.

B. customers' perceptions of price.

51. (p. 382) A(n) __________ exists when producers and ultimate consumers deal one-on-one with each other. A. strategic channel alliance B. direct channel C. marketing channel D. indirect channel E. dual distribution channel

B. direct channel

30. (p. 381) Logistical function activities include A. buying and selling. B. sorting, storing, and moving products. C. financing and grading. D. risk taking. E. marketing information and research.

B. sorting, storing, and moving products.

115. (p. 352) Setting a price to achieve a profit that is a specified percentage of the sales volume is referred to as __________. A. target return-on-investment pricing B. target return-on-sales pricing C. loss-leader pricing D. penetration pricing E. standard markup pricing

B. target return-on-sales pricing

177. (p. 391) Which of the following statements describes the most significant distinction between a corporate vertical marketing system and an administered vertical marketing system? A. Administered vertical marketing systems gain power through ownership while vertical marketing systems gain power through corporate agreement. B. Administered vertical marketing systems gain power through size and influence of one channel member and through ownership. C. Administered vertical marketing systems achieve coordination at successive stages of production and distribution by the size and influence of one channel member rather than through ownership. D. Administered vertical marketing systems gain power through contractual agreement and ownership. E. Administered vertical marketing systems are usually larger and more profitable than corporate vertical marketing systems.

C. Administered vertical marketing systems achieve coordination at successive stages of production and distribution by the size and influence of one channel member rather than through ownership.

204. (p. 394) Which type of distribution lies between the two distribution extremes and means that a firm selects a few retail outlets in a specific geographical area to carry its products? A. Intensive distribution B. Extensive distribution C. Selective distribution D. Exclusive distribution E. Concentrated distribution

C. Selective distribution

276. (p. 365) Five common forms of pricing include: bait and switch, bargains conditional on other purchases, comparisons with suggested prices, and former price comparisons. What do all these practices have in common? A. They are all most effective in the growth stage of the product life cycle. B. They are all popular techniques preferred by online businesses. C. They are all illegal and often difficult to prosecute. D. They are most effective in business-to-business marketing. E. They are all effective pricing practices that professional marketers use.

C. They are all illegal and often difficult to prosecute.

82. (p. 349) Standard markup pricing refers to A. adjusting the price of a product so it is "in line" with that of its largest competitor. B. setting the price of a line of products at a number of different price points. C. adding a fixed percentage to the cost of all items in a specific product class. D. setting prices to achieve a profit that is a specified percentage of the sales volume. E. increasing the price slightly to protect against undue profit losses from unforeseen environmental factors.

C. adding a fixed percentage to the cost of all items in a specific product class.

63. (p. 349) Marketing two or more products in a single package price is referred to as A. piggy-back pricing. B. loss-leader pricing. C. bundle pricing. D. tie-in pricing. E. multi-product pricing.

C. bundle pricing.

76. (p. 385) Multichannel marketing is the blending of different __________ that are __________ in attracting, retaining, and building relationships with consumers who shop and buy in traditional intermediaries and online. A. pricing channels; mutually exclusive B. distribution channels; mutually exclusive C. communication and delivery channels; mutually reinforcing D. communication and delivery channels; mutually exclusive E. communication channels; mutually exclusive

C. communication and delivery channels; mutually reinforcing

33. (p. 381) Facilitating function activities include A. buying and selling. B. assorting, sorting, and storing. C. financing, grading, and marketing information and research. D. risk taking. E. transportation.

C. financing, grading, and marketing information and research.

232. (p. 397) Conflict occurring between intermediaries at the same level in a marketing channel, such as between two or more retailers is referred to as _____. A. corporate conflict B. vertical conflict C. horizontal conflict D. administered conflict E. contractual conflict

C. horizontal conflict

45. (p. 382) Marketing channels help create value for consumers through four utilities. The utilities are A. product, price, promotion, and place. B. form, function, risk taking, and selling. C. time, place, form, and possession. D. transactional, logistical, facilitating, and marketing. E. buying, selling, storing, and transporting.

C. time, place, form, and possession.

36. (p. 347) Talbot's sells women's clothes. A simple tee shirt with the Talbot's label costs $25. If you know you simply want a tee shirt, you can buy one for $5 at a Family Dollar Store, but it won't have the Talbot's label or quality. What kind of demand-oriented approach to pricing is being used by this manufacturer? A. Experience curve pricing B. Skimming pricing C. Demand-backward pricing D. Prestige pricing E. Flexible pricing

D. Prestige pricing

38. (p. 347) Which type of pricing method has a demand curve that slopes downward and to the right, then turns back to the left? A. Prestige pricing B. Skimming pricing C. Penetration pricing D. Price lining E. Demand-backward pricing

D. Prestige pricing

21. (p. 346) The Apple iPhone was recently introduced at an initial price of $600. People waited in line overnight so they could be one of the first to own these unique phones. Which pricing strategy did Apple use to help recoup its research and development costs for the phone? A. Price lining B. Experience curve pricing C. Customary pricing D. Skimming pricing E. Target pricing

D. Skimming pricing

222. (p. 397) When one channel member believes another channel member is engaged in behavior that prevents it from achieving its goals, it is referred to as __________. A. disintermediation B. hegemony C. partnership inconsistency D. channel conflict E. relationship variance

D. channel conflict

6. (p. 346) Key to setting a final price for a product is to find an approximate price level to use as a reasonable starting point. Four common approaches to helping find this approximate price level are (1) demand oriented, (2) cost-oriented, (3) profit-oriented, and (4) __________ approaches. A. revenue-oriented B. reduced risk-oriented C. multi-pricing oriented D. competition-oriented E. cause-oriented

D. competition-oriented

228. (p. 397) Channel conflict that arises when member bypasses another member and sells or buys product direct, it is referred to as __________. A. horizontal conflict B. channel circumvention C. vertical conflict D. disintermediation E. side stepping

D. disintermediation

78. (p. 386) An arrangement whereby a firm reaches different buyers by employing two or more different types of channels for the same basic product is referred to as __________. A. a strategic channel alliance B. multiple level selling C. parallel distribution D. dual distribution E. multi-layered distribution

D. dual distribution

46. (p. 348) Price lining refers to A. charging different prices to different buyers for goods of like grade and quality. B. setting a low initial price on a new product to appeal immediately to the mass market odd-even pricing. C. setting a market price for product or product class oriented on a subjective feel for the competitors' price or market price as the benchmark. D. setting the price of a line of products at a number of different specific price points. E. adjusting the price of a product so it is "in line" with that of its largest competitor.

D. setting the price of a line of products at a number of different specific price points.

148. (p. 390) When a producer owns an intermediary at the next level down in the marketing channel, it is referred to as __________. A. forward integration B. backward integration C. vertical channel connection D. horizontal channel connection E. horizontal integration

A. forward integration

58. (p. 383) A channel that includes intermediaries that are between the producer and consumer and perform numerous channel functions are referred to as a(n) A. indirect channel. B. skewed channel. C. multi-level channel. D. full-service channel. E. limited-service channel.

A. indirect channel.

20. (p. 380) Two students, Nick and Lee, were studying for an upcoming exam in their introduction to marketing course. While studying the chapter on marketing channels and wholesalers, Nick made the following statement: "If it weren't for wholesalers and other intermediaries in the channel of distribution, the products we buy would cost a lot less!" After contemplating Nick's statement, Lee said, "Wait a minute. We learned in class that channel intermediaries actually make marketing more efficient by minimizing the number of transactions necessary to sell products." Lee's statement refers to A. value created by channel intermediaries. B. channel intermediary development. C. price inflation by channel intermediaries. D. channel intermediary promotional efforts. E. an inaccurate statement by Lee; Nick was correct.

A. value created by channel intermediaries.

265. (p. 364) Two or more competitors explicitly or implicitly setting prices is referred to as __________. A. competitive collusion B. vertical price fixing C. horizontal price fixing D. subversive competition E. price alignment

C. horizontal price fixing

187. (p. 393) The three degrees of distribution density are A. intensive, extensive, and selective. B. extensive, concentrated, and selective. C. intensive, exclusive, and selective. D. extensive, pervasive, and concentrated. E. concentrated, exclusive, and intensive.

C. intensive, exclusive, and selective.

32. (p. 347) When Hallmark cards introduced a line of $.99 cards (about half the price of the previously least expensive cards sold by Hallmark), the greeting card company was trying to appeal to a mass market that was price sensitive. Hallmark was using a __________ pricing strategy. A. prestige B. skimming C. penetration D. demand-backward E. experience-curve

C. penetration

280. (p. 365) The practice of changing a very low price for a product with the intent of driving competitors out of business is referred to as A. price fixing. B. price discrimination. C. predatory pricing. D. deceptive pricing. E. geographical pricing.

C. predatory pricing.

54. (p. 382) In a direct channel, all channel functions are performed by __________. A. retailers B. wholesalers C. producers D. brokers and agents E. middlemen

C. producers

12. (p. 346) Skimming pricing is a strategy that introduces a new or innovative product by A. following competitors' leads. B. creating multiple price points. C. setting a high initial price. D. setting a low initial price. E. setting the price at a pre-determined percentage below its nearest competitor's price.

C. setting a high initial price.

104. (p. 350-351) The retail price of cell phones has decreased from $4,000 to less than $99 over several years. This is due in large part to which type of pricing? A. Skimming pricing B. Prestige pricing C. Odd-even pricing D. Experience curve pricing E. Customary pricing

D. Experience curve pricing

What is the goal target return on sales percentage?

20%

139. (p. 390) Professionally managed and centrally coordinated marketing channels designed to achieve channel economies and maximum marketing impact are referred to as __________. A. integrated marketing systems B. horizontal marketing systems C. vertical marketing systems D. functional marketing systems E. cooperative marketing systems

C. vertical marketing systems

Demand-oriented approaches weigh factors that underlie expected __________ more heavily than factors such as cost, profit, and competition when selecting a price level. A. total sales revenue B. market volatility C. prevailing prices D. product substitutes E. customer tastes and preferences

E. customer tastes and preferences

34. (p. 347) Setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it is referred to as A. skimming pricing. B. status pricing. C. price lining. D. value pricing. E. prestige pricing.

E. prestige pricing.

260. (p. 363) Five pricing practices are closely scrutinized because of potential unethical or illegal actions. They include (1) price discrimination, (2) deceptive pricing, (3) geographical pricing, (4) predatory pricing, and (5)__________. A. range-line pricing B. manufacturer managed accounts C. regional rollbacks D. delayed payment penalties E. price fixing

E. price fixing

108. (p. 351) Target profit pricing refers to A. adjusting the price of a product so it is "in line" with that of its largest competitor. B. setting the price of a line of products at a number of different price points. C. adding a fixed percentage to the cost of all items in a specific product class. D. setting prices to achieve a profit that is a specified percentage of production costs. E. setting an annual target of a specific dollar volume of profit.

E. setting an annual target of a specific dollar volume of profit.

29. (p. 381) In terms of distribution, when marketing channel members are engaged in buying, selling, and risk taking, they are performing __________ functions. A. logistical B. transformational C. facilitating D. implementation E. transactional

E. transactional

178. (p. 391) Procter & Gamble can obtain cooperation from supermarkets in terms of displaying, promoting, and pricing its products, given its broad assortment of brand-name products. Which type of vertical marketing system does Procter & Gamble represent? A. Corporate vertical marketing system B. Integrated vertical marketing system C. Contractual vertical marketing system D. Administered vertical marketing system E. Interactive vertical marketing system

D. Administered vertical marketing system