MKT 230 Chpt 14

Which of the following is an example of pure competition?

Agricultural products like corn and soybeans, where many sellers provide essentially identical products.

Which of the following are some limitations to break-even analysis are

It represents an average price to account for variances It cannot predict how many units will sell

Break-even analysis examines the relationships between which of the following?

Price Profit Costs

Strategies that can be used as part of the profit orientation strategy include:

Target profit pricing Maximizing profits strategy

The types of strategies that could be implemented in a profit orientation strategy include which of the following?

Target return pricing Maximizing profits strategy

Which of the following is an example of an oligopoly?

The oil industry, with a limited number of providers

A break-even analysis graph contains which of the following?

Total revenue Fixed costs Total costs

Channel members include which of the following?

Wholesalers Retailers Manufacturers

When firms compete by lowering price at retail, they are engaged in _____

a price war

A useful technique that enables managers to examine the relationships among cost, price, revenue, and profit over different levels of production and sales is called ______

break-even analysis

Variable costs _____ production volume

change with

In the customer orientation strategy, firms might sell their products or services at high prices in order to:

communicate exclusivity enhance the values of the products in consumer' minds enhance the company's reputation and image

With _____ ______ companies set their prices close to those of their major competitors

competitive; parity

Products whose demands are positively related to one another are known as _____ products

complementary

The Five C's of pricing are: company objectives, customers, channel partners, competition, and _____.

costs

In a pure competition market, to differentiate products, firms are advised to ___________.

decommoditize products

Prestige products or services do not follow the _____ curve

downward-sloping demand

With _____ _____ companies charge different prices based on the type of customer, the day of the week, and level of demand.

dynamic pricing

A firm may set low prices to

encourage current firms to leave the market take market share away from competitors discourage firms from entering the market.

For a firm, rent, landscaping, and insurance are examples of _____ costs

fixed

The customer orientation strategy increases value by:

focusing on customer satisfaction setting prices to match consumer expectations

When there are many substitute products available, the price elasticity of demand for a given product will likely be _____

higher

A demand curve enables a firm to examine prices _____

in terms of how many buyers want the product

Consumers are generally ___________ sensitive to price increases for necessities like milk than for items such as restaurant dining.

less

When a firm is able to use a mathematical model that can explain and predict sales, it is able to implement the _____

maximizing profits strategy

When only a few firms dominate a market, it is known as _____ competition.

oligopolistic

Over the years, Walmart has been accused of opening stores in new communities with artificially low prices, set for the sole purpose of driving competing stores in the area out of business. This type of behavior is called __________ pricing.

predatory

When a firm deliberately prices a product above the prices set for competing products to entice those customers for whom pricing does not matter, the firm is engaging in _____ pricing

premium

Firms engage in price wars to:

preserve their market share

The contribution per unit is the _____ minus the variable cost per unit.

price

Loyalty toward a particular brand makes other brands seem less substitutable which decreases _____

price elasticity of demand

The ratio of change in a price and its effect on the quantity of the product demanded is known as _____

price elasticity of demand

A _____ _____ occurs when companies compete with each other by lowering their prices.

price; war

A store that helps its customers achieve economies of scale by buying as a group is a _____ _____

retailer cooperative

Compared to other company objectives, a sales-oriented firm _____

sets prices very low to generate new sales, even if profits suffer

Which of the following is an example of a monetary sacrifice included in the overall price?

shipping

With _____ _____ _____ companies change their prices only to meet those of their competitors.

status quo pricing

When the changes in demand for one product negatively affects the demand for another product, the items are known as _____ products.

substitues

Firms that are less concerned with the level of profits and more interested in the rate at which profits are generated, relative to their investments, tend to use ______

target return pricing

When incomes drop, the demand for an elastic product _____

tends to decrease.

Prestige products or services follow the premise that _____ that is associated with the product.

the higher the price, the greater the status

Price is best defined as:

the overall sacrifice a consumer is willing to make to acquire a specific product or service

The _________ is the sum of fixed costs and variable costs

total costs

Price times quantity is ______

total revenue

Variable cost per unit times quantity equals _____

total variable cost

Companies use dynamic pricing depending on such characteristics as the

type of customer time of day level of demand

The relationship between a product's benefits and the consumer's costs is known as its _____

value

Other elements in the marketing mix may or may not be perfect, but if the prices is wrong, revenue _____

will not accrue

At the break-even point, profits on the sale of a product are _____

zero