Ch. 10
What is the first thing marketers must do when using value-based pricing? A. Set the target price to match customer perceived value. B. Assess customer needs and value perceptions. C. Design a quality product. D. Determine product costs. E. Convince buyers that the product's value at a given price justifies the purchase.
Assess customer needs and value perceptions.
Which of the following statements is true regarding costs? A. Experience curve pricing is a low risk strategy. B. Average cost tends to decrease with accumulated production experience. C. Variable costs vary directly with the level of sales. D. Totals costs are the sum of long-run average costs and short-run average costs. E. Costs do not vary with different levels of production.
Average cost tends to decrease with accumulated production experience.
Which of the following correctly identifies the three major pricing strategies used by marketers? A. Customer valuedash-based pricing, cost-based pricing, and profit-based pricing B. Customer valuedash-based pricing, cost-based pricing, and revenue-based pricing C. Customer valuedash-based pricing, revenue-based pricing, and competition-based pricing D. Customer valuedash-based pricing, revenue-based pricing, and profit-based pricing E. Customer valuedash-based pricing, cost-based pricing, and competition-based pricing
Customer valuedash-based pricing, cost-based pricing, and competition-based pricing
Which of the following is true regarding the pricedash-demand relationship? A. Price elasticity measures how responsive price will be to a change in demand. B. If demand is elastic, sellers will consider lowering their price. C. If demand is inelastic, a small change in price will result in a large change in demand. D. A demand curve shows the number of units a company will produce in a given time period at different prices that might be charged. E. Demand and price are directly relatedlong dash—the higher the price, the greater the demand.
If demand is elastic, sellers will consider lowering their price.
Which of the following statements regarding customer valuedash-based pricing is correct? A. This strategy is seldom used because buyers rarely consider perceived value when evaluating a product's price. B. In using this strategy, companies often find it hard to measure the value customers attach to their product. C. Using this strategy, marketers must convince buyers that the product's value at that price justifies its purchase. D. Using this strategy, marketers first design the product and marketing program, then set the price. E. Customer valuedash-based strategy begins with determining product costs.
In using this strategy, companies often find it hard to measure the value customers attach to their product.
Which factor sets the floor on setting a product's price? A. Product costs B. Competitors C. Demand D. Revenue E. Customer's value perceptions
Product costs
What is target costing? A. Setting a price and then setting costs that will ensure that the price is met B. Basing price on customer perceptions of cost C. Setting acceptable costs and then setting the price D. Pricing products without any consideration to costs E. Designing a product, then determining its cost and price
Setting a price and then setting costs that will ensure that the price is met
How is price determined using cost-plus pricing? A. The price is set by determining the customer's value perceptions. B. The price is set by adding a standard mark-up to the cost of the product. C. The price is set so that total revenue covers total costs. D. The price is set based on demand. E. The price is set based on competitor's prices.
The price is set by adding a standard mark-up to the cost of the product.
A(n) __________ shows the number of units the market will buy in a given time period at different prices. A. demand curve B. value curve C. perceptual map D. supply curve E. production schedule
demand curve
Price is the only part of the marketing mix that __________. A. incurs costs B. is defined by the consumer C. produces revenue D. does not play a role in creating customer value E. attracts buyers
produces revenue