MML Quiz#6

Basic price adjustments known as​ __________ are used to reward customers for certain responses.

discounts and allowances

A car buyer can choose a base model at one​ price, or one with a premium sound and navigation system at a higher price. This is an example of​ _______ pricing.

optional-product

The Ford Mustang is offered in several different models. Ford will use​ ________ pricing to determine the price steps between the different models.

product line

A soda pop company offers a discount to a grocer. In​ exchange, the grocer agrees to provide​ in-store advertising for the soda pop and additional​ sales-support. This is an example of​ __________.

promotional allowances

Some sellers use​ 00-cent endings on regularly priced items and​ 99-cent endings on discount merchandise. This is an example of pricing referred to as​ __________.

psychological pricing

In​ __________pricing, the company sells a product or service at two or more​ prices, even though the difference in prices is not based on differences in costs.

segmented

​________ is the practice of pricing products below cost to harm competitors.

Predatory pricing

What is predatory​ pricing?

Selling below cost with the intention of punishing a competitor

Margaret has been invited to a fancy dinner party and wants to bring a good bottle of wine as a gift for the host. Because she does not know much about​ wine, she will likely use the price of the wines as​ _______

an indicator of quality

Companies that use​ ________ continually adjust prices to meet the characteristics and needs of individual customers and situations.

dynamic pricing

One form of​ __________ is when movie theaters charge one price for adults and a different price for senior citizens.

​customer-segment pricing

________ occurs when retailers set an artificially high​ "regular price" and then advertise a​ "sale price," which is actually close to their everyday price.

Deceptive pricing

Which of the following statements is true concerning new product pricing​ strategies?

For a​ market-skimming strategy to be​ successful, the costs of producing a smaller volume cannot be so high that they cancel the advantage of charging more.

When would a competitor most likely react to a​ firm's price​ change?

When the number of firms involved is small

Cheese makers in Wisconsin sell their leftover brine to local city and county highway​ departments, which use it in conjunction with salt to melt icy roads. Which product mix pricing strategy does this​ represent?

​By-product pricing

A company has set a low price on a new product it introduced. It wants to maximize its market share and attract a large number of buyers quickly. Which new product pricing strategy should the company​ use?

​Market-penetration pricing

Gillette charges a fairly low price for its razors​ (relative to​ costs) and a high price for razor blades. It is using a strategy of​ ________ pricing.

​captive-product

When Apple introduced its​ iPhone, it priced the new product at​ $599, considerably higher than either its iPod or competing cellular phones. Apple Computer was pursuing​ a(n) ________ new product pricing strategy.

​market-skimming

Archer Daniels Midland Co is the​ world's largest processor of​ soybeans, corn, and wheat. In the​ 1990s, the Justice Department found it guilty of regularly meeting with competitors when setting prices. ADM was guilty of​ ________.

​price-fixing

Many personal care companies combine toothpaste with a toothbrush at a reduced price. This is an example of​ __________ pricing.

​product-bundle