MKT Chap 9

Which of the following is true regarding the​ price-demand relationship? A. A demand curve shows the number of units a company will produce in a given time period at different prices that might be charged. B. If demand is​ inelastic, a small change in price will result in a large change in demand. C. Price elasticity measures how responsive price will be to a change in demand. D. Demand and price are directly related dash- the higher the​ price, the greater the demand. E. If demand is​ elastic, sellers will consider lowering their price.

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

Which of the following statements is true regarding initiating price​ increases? A. Prices should be increased when there is a lack of demand. B. Companies do not need to communicate reasons for price increases to customers. C. Price increases do not impact profits. D. Cost inflation is not a factor in price increases. E. Wherever​ possible, the company should consider ways to meet higher costs or demand without raising prices.

Wherever​ possible, the company should consider ways to meet higher costs or demand without raising prices.

Companies that use​ ________ continually adjust prices to meet the characteristics and needs of individual customers and situations. A. psychological pricing B. dynamic pricing C. segmented pricing D. cash rebates E. promotional pricing

dynamic pricing

Selling below cost with the intention of punishing a competitor or gaining higher​ long-run profits by putting competitors out of business is an illegal practice called​ _______. A. deceptive pricing B. price maintenance C. predatory pricing D. price discrimination E. price fixing

predatory pricing

Over the​ years, U.S. air carriers have been accused numerous times of collusion when setting prices. This illegal practice is called​ _______. A. price fixing B. retail price maintenance C. deceptive pricing D. price discrimination E. predatory pricing

price fixing

The Ford Mustang is offered in several different models. Ford will use​ __________ pricing to determine the price steps between the different models. A. ​captive-product B. ​two-part pricing C. ​optional-product D. ​product-bundle E. product line

product line

​Geared2Beer, a craft beer​ brand, identifies a market segment that is willing to pay premium prices for its craft​ beer, and Geared2Beer managers select an ideal selling price. Managers then determine the costs to create craft beer that meets the ideal selling price. The​ company's pricing approach is referred to as​ ________. A. ​cost-plus pricing B. target return pricing C. EDLP D. ​value-added pricing E. target costing

target costing

One major objective associated with a​ market-penetration pricing strategy is to​ ________. A. prevent customer dissatisfaction B. avoid everyday low pricing C. attract buyers willing to pay a higher price D. skim off small but profitable market segments E. win a large market share

win a large market share

Sadie's Restaurant has listened to its customers over the years and is now able to offer the right combination of quality and good service at a fair price. Which pricing strategy is​ Sadie's using? A. ​Good-value pricing B. ​Cost-based pricing C. ​High-low pricing D. Breakeven pricing E. Value added pricing

​Good-value pricing

When Apple Computer Company introduced its​ iPhone, its priced the new product at​ $599, considerably higher than either their iPod or competing cellular phones. Apple Computer was pursuing a​ ___________________ new product pricing​ strategy. A. ​by-product B. ​optional-product C. ​market-skimming D. ​captive-product E. ​market-penetration

​market-skimming

Which of the following is a​ cost-oriented pricing​ approach? A. EDLP pricing B. Breakeven pricing C. Value added pricing D. ​Competition-based pricing E. ​High-low pricing

Breakeven pricing

​________ refers to setting price based on​ buyers' perception of value rather than on the​ seller's cost. A. ​Cost-based pricing B. Customer​ value-based pricing C. ​Value-added pricing D. Cost E. ​Good-value pricing

Customer​ value-based pricing

Which of the following statements is true regarding initiating price​ cuts? A. Cutting price has no effect on costs. B. If faced with excess​ capacity, a firm should not cut its price. C. Firms never cut​ prices; they only raise them. D. When faced with falling​ demand, firms should not cut prices. E. Cutting prices in an industry loaded with excess capacity may lead to price wars.

Cutting prices in an industry loaded with excess capacity may lead to price wars.

Which of the following statements is true regarding oligopolistic​ competition? A. The market consists of many large sellers. B. Each seller is alert and responsive to​ competitors' pricing strategies and marketing moves C. The market is dominated by one seller. D. Many buyers and sellers trade a uniform commodity. E. The market consists of many buyers and sellers trading over a range of prices.

Each seller is alert and responsive to​ competitors' pricing strategies and marketing moves

Which of the following is a potentially effective action a company could take in response to a​ competitor's price​ cut? A. Decrease perceived value B. Raise price C. Reduce both price and quality. D. Reduce price E. Launch a​ high-price "fighter​ brand"

Reduce price

UPS charges different prices for shipping depending on an​ item's destination. The more distant the city the package is being shipped​ to, the higher the price UPS charges. Which geographic pricing method is UPS​ using? A. ​Base-point pricing B. ​Freight-absorption pricing C. ​Uniform-delivered pricing D. FOB origin E. Zone pricing

Zone pricing

Margaret has been invited to a fancy dinner party and wants to bring a good bottle of wine as a gift for the host. Since she does not know much about​ wine, she will likely use the price of the wines as​ ________. A. an indicator of geographic pricing B. an indicator of the cost of production C. an indicator of quality D. a limited time offer E. a type of segmented pricing

an indicator of quality

A retailer temporarily prices a few select items below cost to create excitement and pull consumers into the store. This is an example of​ _________ pricing. A. promotional B. psychological C. geographical D. optional product E. segmented

promotional

Internal factors that affect pricing include​ ________. A. The​ company's overall marketing​ strategy, the nature of the​ market, and demand. B. the​ company's overall marketing​ strategy, objectives, and marketing mix C. the​ company's overall marketing​ strategy, objectives and demand D. The nature of the​ market, demand, and the economy. E. The​ company's overall marketing​ strategy, objectives and the nature of the market

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

​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, super-wide​ screens, and other amenities for which they charge a higher price. This is an example of which type of​ pricing? A. Breakeven pricing B. ​High-low pricing C. ​Cost-plus pricing D. EDLP pricing E. ​Value-added pricing

​Value-added 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. A. product line B. ​by-product C. ​two-part pricing D. ​captive-product E. ​product-bundle

​captive-product

Many state colleges and universities charge one price for​ in-state students and a higher price for​ out-of-state students. Which form of segmented pricing are these schools​ using? A. ​customer-segment pricing B. ​time-based pricing C. ​location-based pricing D. promotional pricing E. product form pricing

​location-based 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? A. ​captive-product pricing B. ​market-penetration pricing C. ​market-skimming pricing D. product bundle pricing E. psychological pricing

​market-penetration pricing

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. A. product line B. ​captive-product C. ​by-product D. ​product-bundle E. ​optional-product

​optional-product

Bath​ & Body Works offers​ "three-fer" deals on its soaps and lotions​ (such as three antibacterial soaps for​ $10). This is an example of​ _______ pricing. A. ​by-product B. ​captive-product C. ​two-part pricing D. ​product-bundle E. product line

​product-bundle