Marketing Management - Iacobucci - Ch 9 (3)
In the marketing framework, the change in a product's ________ is easily measurable when compared to the other Ps. a. price b. promotion c. features d. place
A
Price sensitivity is greater when the product is a ________. a. luxury good b. necessity c. consumer durable good d. complementary good
A
If Profit = Revenue - Expense and Revenue = Price × Quantity sold, then to maximize profits we need to find a price where any further increase in price would lead to a large falloff in demand.
true
In most markets, there is almost always a price-sensitive segment and another that seeks quality.
true
Pricing for market penetration and skimming are contrasting strategies.
true
Pricing is as important as any of the other Ps in terms of sending a signal to customers, competitors, and collaborators regarding the positioning and image of the brand.
true
Temporary price cuts and coupons are reliable in generating a modest short-term uptick in sales.
true
Which of the following is true about competitive pricing?
It is at a medium level, somewhere in between extremes, using competitors' prices as a starting point, and adjusting from there.
A ________ is a means of figuring out how many units a manufacturer has to sell before recovering his costs. a. conjoint analysis b. Vals test c. breakeven analysis d. beta test
C
If the price of a product goes up, which of the following drives the demand for the same product? a. Large number of B2B substitute products b. Small number of complementary products c. Small number of substitute products d. Large number of complementary products
C
Dominic Inc., a pretzel manufacturer, introduced a new flavor of pretzels in the market. The fixed manufacturing costs came up to $5,000, and the cost of packaging materials for a box came up to $15. If a box of pretzels is priced at $25, what is the breakeven point of Dominic Inc.? a. 50 boxes b. 250 boxes c. 200 boxes d. 500 boxes
D
Which of the following explains the difference between elastic and inelastic demand? a. Elastic demand means product demand varies with a change in the product's price, while inelastic demand means the product demand remains static even with a change in the product's price. b. Elastic demand relates to intangible services, while inelastic demand relates to tangible goods. c. Elastic demand relates to the internal projects of a firm, while inelastic demand relates to the external projects of a firm. d. Elastic demand means the product demand depends on the segmentation process of a firm, while inelastic demand means the product demand depends on the targeting process of a firm.
(A) elasticity in supply and demand p. 133-136.
Which of the following formulas defines profit?
(Price × Demand) - (Fixed costs) - (Variable costs × Demand)
If a firm prices its brand too low, the volume of sales will pick up. a. True b. False
A
What term refers to the "wiggle room" in the supply and demand curve?
elasticity
Depending on whether customers experience a price or time shift, it may be unimportant for a company to manage perceptions of price fairness.
false
Goods are tricky because they are disproportionately high in variable costs.
false
In conjoint analysis, customers are directly asked about price.
false
With dynamic pricing, the buyer sets the price at an auction.
false
Marketers frequently use __________ to try to estimate the likely results of various actions, most frequently price cuts and competitive response.
game theory
Lee is the product manager for a software program sold by Company ABC. In evaluating the product, Lee determines that something just isn't right with how the software program is marketed to potential customers, and he feels a change is necessary. Which of the following marketing mix variables is easiest for Lee to change?
price
Ashton wants to generate interest in the new branch of his hobby stores that is opening next week. He plans to offer temporary price cuts and issue coupons. This practice is referred to as
price promotion
Jessie is just as likely to use a $15 coupon for a $29 item as she is to use a $15 coupon on a $199 product.
false
Pricing tends to stay the same over the course of a product's life cycle.
false
Services are said to be __________, which means there is no such thing as storing inventory or excess capacity.
perishable
Which of the following pieces of information is found in scanner data?
the quantities bought
A two-part tariff is used in linear pricing. a. True b. False
B
An auction uses a static pricing strategy. a. True b. False
B
If a firm's variable costs are high relative to its fixed costs, the sales volume should be maximized. a. True b. False
B
If the unit cost of a product is $4 and the intended rate of return is 25%, determine the covering cost of the product using the cost-plus pricing model? a. $4.73 b. $5.33 c. $14.00 d. $4.23
B
In a(n) ________ study , customers are shown products with various combinations of features and attributes, with price being one of them. a. unit-margin b. conjoint c. break-even d. beta test
B
In the context of high pricing strategies for products, the equation used to determine the percent change in sales for a stable price sensitive product is: a. (Price sensitivity * Original Price) / (New Price - Original Price) b. Price sensitivity * ( New price - Original price) / Original price c. ( New Price - Original Price ) / (Price sensitivity * Original price ) d. Original Price * (New price - Original price ) / Price sensitivity
B
In the context of pricing, brand loyal customers are elastic in nature. a. True b. False
B
Price sensitivity should decrease when price information is easily available to customers to compare across competing brands. a. True b. False
B
The idea that price is actually negotiated between the buyer and seller refers to which of the following terms?
dynamic pricing