MKT 210 Ch. 10

Price is the only part of the marketing mix that ______________.

produces revenue

Which of the following statements is true regarding costs?

Average cost tends to decrease with accumulated production experience.

What is the first step in a value-based pricing strategy?

Assess customer needs and value perceptions.

Which of the following is a cost-based pricing approach?

Break-even pricing

Which of the following is true regarding the price-demand relationship?

If demand is elastic, sellers will consider lowering their price.

Which factor sets the floor on setting a product's price?

Products costs

On a break-even chart, the break-even volume is located ______________.

at the intersection of total revenue and total costs

Two external factors which must be considered in pricing decisions are _______________.

demand and the nature of the market

A(n) _______________ shows the number of units the market will buy in a given time period at different prices.

demand curve

The amount of money charged for a product or service is its _________.

price

Under ________________ , the market consists of many buyers and sellers trading in a uniform commodity.

pure competition

Internal factors that affect pricing include _____________.

the company's overall marketing strategy, objectives, and marketing mix

In a broad sense, price is _____________.

the sum of all the value that customers give up to gain the benefits of having or using a product or service

Which of the following correctly identifies the three major pricing strategies used by marketers?

Customer value-based pricing, cost-based pricing, and competition-based pricing

Which factor sets the ceiling on setting a product's price?

Customers' value perceptions

Which type of market consists of many buyers and sellers trading over a range of prices rather than a single market price?

Monopolistic competition

In which type of market does no buyer or seller have much impact on setting the going market price?

Pure competition

What is target costing?

Setting a price and then setting costs that will ensure that the price is met

How is price determined using cost-plus pricing?

The price is set by adding a standard mark-up to the cost of the product.

New, premium movie theaters offer features such as online reserved seating, high-backed leather executive chairs with armrests and footrests, the latest in digital sound and super-wide screens, and other amenities for which the charge a higher price. This is an example of which type of pricing?

Value-added pricing