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Exam 13: Building the Price Foundation

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Question 71

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Which of the following best illustrates a shift in the demand curve?

A) When prices remain the same,there is a significant decrease in profit.
B) As the price is raised,the quantity demanded increases,assuming all else stays the same.
C) When prices remain the same,there is an increase or decrease in demand.
D) As the price is lowered,the quantity demanded decreases,assuming all else stays the same.
E) An internal matter has forced a price change of some type,but it does not impact demand.

F) A) and B)
G) B) and E)

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Question 72

Multiple Choice

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Factors that determine consumers' willingness and ability to pay for products and services are referred to as

A) supply factors.
B) demand factors.
C) affordability factors.
D) elasticity factors.
E) macro environmental factors.

F) None of the above
G) C) and D)

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Question 73

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Which of the following would be an example of an objective in Step 1 of the price-setting process?

You are president of an electric appliances manufacturer.You want to reduce your break-even quantity.All things being equal,you can do this by

A company that manages apartments decides to buy 15 new dishwashers at a list price of $550 each as replacements for old dishwashers in a small apartment complex it owns.Because the company is buying more than 10 dishwashers,it is eligible for a $150-per-unit quantity discount.Financing charges total $20 per unit.The company gets $10 per dishwasher for the 15 dishwashers traded in.What is the final price the company will pay for each dishwasher?

Figure 13-5 -The owner of a picture frame store has generated a spreadsheet of several calculations based on different quantity,price,revenue,cost,and profit scenarios shown in Figure 13-5 above.Of the following options,at what sales level is profit maximized?

The total money received from the sale of a product is referred to as

Price elasticity of demand (E) is expressed as (∆ means change)

A demand curve graph typically appears as

Campbell Soup spent seven years and $55 million on a secret project to produce a line of Intelligent Quisine (IQ) food products "scientifically proven to lower high levels of cholesterol,blood sugar,and blood pressure." The company was responding to the needs and desires expressed by consumers.However,after 15 months in an Ohio test market,Campbell Soup yanked the entire IQ line because  

When it was launched,the BMW Streetcarver was the only skateboard with stabilizers and wheel design based on BMW's automobiles.This technology gave the BMW Streetcarver better control at high speeds and around sharp turns than any other brand.The skateboard was priced at $495,which left many consumers (especially young males) who might have wanted to buy the Streetcarver unable to afford it.This inability to pay for the high-priced BMW-made skateboard shows the effect of ________ on sales.

If the CEO of the Clorox Co.were to say,"We want to control 60 percent of the bleach market within the next five years," he would have set a ________ pricing objective.

Marketing managers often use break-even analysis to analyze the relationship between total revenue and total cost to determine profitability at various levels of output.What is the break-even formula? Use the formula to calculate how many radio-controlled drones a dealer must sell if her fixed costs are $100,000,unit variable costs are $150,and the selling price is $200.

Suppose you want to buy a Tesla Model S,the world's leading all-electric,zero-emission car that has a 265-mile range and can be recharged in three hours.The Tesla Model S Performance model has a list price of $87,500.However,you want several options (Performance Plus Package,red multicoat armor paint,Tech Package,Sound Studio Package,home charging station,performance wheels,and others) that will cost $17,500.An extended warranty will add an additional $5,000.However,if you put $50,000 down now and finance the balance over the next year,you will receive a dealer rebate of $5,000 off the list price.The dealer will give you a $7,000 trade-in allowance for your 2010 Honda Civic DX four-door sedan.In addition,you will have to pay a state sales tax of $10,000,an auto registration fee of $1,000 to the state,and a $1,000 destination charge to ship and prep the car.But because the Tesla Model S is an alternative energy vehicle,you qualify for a $2,500 state rebate and a $7,500 federal tax credit! Finally,your total finance charge is $7,000.Applying the price equation,what is your final price for the Tesla Model S?

The break-even point (BEP) = [________ ÷ (Unit price − Unit variable cost) ].

The competitive market situation in which many sellers follow the market price for identical,commodity products is referred to as

Price refers to

A technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output is referred to as

The sum of the expenses of a firm that is stable and does not change with the quantity of the product that is produced and sold is referred to as

Several companies produce latex gloves that are used in a variety of different industries.If one of the glove manufacturers decreases its price by just a few percentage points,it will result in a significant increase in quantity demanded.The demand for latex gloves is