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