Question 1

Explain the price equation in the context of a new car purchase.

Accepted Answer

The price equation is price = [list pric...

Question 2

Which of the following is a cost-oriented approach to pricing?

Accepted Answer

A)  cost-plus pricing
B)  skimming pricing
C)  prestige pricing
D)  loss-leader pricing
E)  bundle pricingF) A) and E)
G) C) and D)

Question 3

A buying situation can involve comparing the costs and benefits of substitute items-such as real sugar to the sugar substitute Equal which, although more expensive than sugar, is purchased by many consumers because it contains no calories.This situation involves the consumer considering

Accepted Answer

A)  a marginal analysis.
B)  a profit equation.
C)  a break-even analysis.
D)  price elasticity of demand.
E)  a reference value.F) B) and D)
G) C) and D)

Question 4

Bundle pricing refers to

Accepted Answer

A)  cash payments or extra amount of "free goods" awarded to sellers in the channel of distribution for undertaking certain advertising or selling activities to promote a product.
B)  marketing two or more products in a single package price.
C)  deliberately selling a product below its customary price, not to increase sales, but to attract customers' attention in hopes that they will buy other products as well.
D)  offering significant price discounts to wholesalers who agree to purchase products in advance for a period of a year or more at a time.
E)  the practice of charging a very low price for a product with the intent of driving competitors out of business.F) A) and C)
G) A) and B)

Question 5

A new car dealer can offer a reduction in the list price of a new Ford pickup truck by offering you a __________ of $1,000 for your 1998 Nissan.

Accepted Answer

A)  cash discount
B)  functional discount
C)  seasonal discount
D)  trade-in allowance
E)  promotional allowanceF) B) and D)
G) A) and C)

Question 6

Central Ice Machine Company is located in Omaha, Nebraska and sells Frick, Sullair, York, and Fes Fuller ammonia refrigeration parts.The company ships using FOB origin pricing.Which of the following statements about the shipment of a Frick reciprocating compressor is true?

Accepted Answer

A)  All buyers will pay no shipping costs because they are paid by Central Ice Machine.
B)  Central Ice Machine pays the same amount as the buyer no matter where the compressor is shipped.
C)  It will cost Central Ice Machine more to ship to Charlotte, North Carolina than to Topeka, Kansas.
D)  A buyer in Albany, New York, will pay significantly more shipping charges than a buyer in Lincoln, Nebraska, and Central Ice Machine will pay none.
E)  All buyers will pay the same shipping costs, and Central Ice Machine will pay none.F) A) and B)
G) None of the above

Question 7

Ace Shoe Company sells heel replacement kits for men's shoes.It has fixed costs of $9 million and unit variable costs of $5 per pair.Ace is considering a switch from manual labor to an automated process.New equipment would cost an additional $4 million per year while lowering variable costs by $3 per shoe repair kit.How many kits would Ace have to sell at $17 per pair to make $2 million in profits in the next year with the automated process?

Accepted Answer

A)  169,231 kits
B)  666,667 kits
C)  705,883 kits
D)  800,000 kits
E)  1,000,000 kitsF) B) and D)
G) A) and E)

Question 8

Setting different prices for products and services depending on individual buyers and purchase situations is referred to as

Accepted Answer

A)  price lining.
B)  customary pricing.
C)  a flexible-price policy.
D)  price fixing.
E)  discretionary pricing.F) A) and E)
G) B) and E)

Question 9

FIGURE 12-6 
-A shift of the demand curve from D1 to D2 in Figure 12-6 above is referred to as

Accepted Answer

A)  movement along the demand curve.
B)  shift of the demand curve.
C)  inelasticity of the demand curve.
D)  elasticity of the demand curve.
E)  changing demand of the demand curve.F) B) and C)
G) A) and C)

Question 10

FIGURE 12-7 
-Figure 12-7 above shows that by selling 200 pictures the firm will

Accepted Answer

A)  break even.
B)  incur a loss.
C)  earn a profit.
D)  have no fixed costs.
E)  have no variable costs.F) C) and D)
G) A) and E)

Question 11

Tara is enrolled for spring semester at college.The tuition is $6,000 but she has a scholarship for $1,000 as well as a work study grant of $1,500.The health fees and student activity fees are $150 for the semester.What is the actual price Tara is paying for the spring semester?

Accepted Answer

A)  $2,500
B)  $2,650
C)  $3,650
D)  $5,150
E)  $6,150F) All of the above
G) A) and B)

Question 12

Three different objectives relate to a firm's profit, which is often measured in terms of return on investment.One objective, known as _________, is where a company gives up immediate profit in exchange for achieving a higher market share in the hopes of penetrating competitive markets.

Accepted Answer

A)  maximizing current profit
B)  target return
C)  breakeven strategy
D)  managing for long-run profits
E)  minimizing riskF) None of the above
G) D) and E)

Question 13

Marketing two or more products in a single package price is referred to as

Accepted Answer

A)  piggy-back pricing.
B)  loss-leader pricing.
C)  bundle pricing.
D)  tie-in pricing.
E)  multi-product pricing.F) None of the above
G) C) and D)

Question 14

The purpose of a cash discount is to

Accepted Answer

A)  reward retailers for making large quantity purchases.
B)  encourage purchasing items during periods of low demand.
C)  prevent competitors from obtaining shelf space.
D)  counteract the introduction of a new product by a competitor.
E)  encourage retailers to pay their bills promptly.F) A) and C)
G) None of the above

Question 15

FIGURE 12-8 
-Figure 12-8 above represents the final three generalized steps in the pricing process.Assume pricing objectives and constraints, estimating demand and revenue, determining the cost, volume, and profit relationships have been completed.Accordingly, at this point cell "C" represents the step at which a firm would

Accepted Answer

A)  raise initial capital.
B)  scan competitors for price lines for similar products or services.
C)  select the appropriate pricing formula.
D)  select an approximate price level.
E)  make special adjustments to the list or quoted price.F) A) and B)
G) C) and D)

Question 16

When Dell sells various laptops it also includes software as part of the package.This is an example of

Accepted Answer

A)  price lining.
B)  loss-leader pricing.
C)  customary pricing.
D)  prestige pricing.
E)  bundle pricing.F) None of the above
G) A) and B)

Question 17

FIGURE 12-7 
-According to Figure 12-7 above, how much profit will the firm make if it sells 400 pictures?

Accepted Answer

A)  $48,000
B)  $35,000
C)  $20,000
D)  $32,000
E)  $0F) C) and E)
G) A) and B)

Question 18

According to Vizio, "The whole goal is to ensure that we have the right product, at the right time and the right price and ________."

Accepted Answer

A)  forever rid the world of plugs and wires
B)  create customer value unparalleled anywhere in the industry
C)  deliver it to the right people
D)  truly make it available to anyone
E)  drive a seamless end-to-end value chainF) D) and E)
G) C) and D)

Question 19

FIGURE 12-4 
-Position "B" in Figure 12-4 above represents the price premium of which of the following?

Accepted Answer

A)  Crunch 'n Munch
B)  Cracker Jack
C)  Fiddle Faddle
D)  Private Brands
E)  Seasonal, specialty, and regional brandsF) B) and C)
G) B) and E)

Question 20

Quantity discounts refer to

Accepted Answer

A)  reductions in unit costs for placing a larger order.
B)  reductions for placing long-term pre-scheduled orders.
C)  price reductions to encourage buyers to stock inventory earlier than their normal demand would require.
D)  reductions in unit costs for purchasing items that are nearing their expiration dates.
E)  reductions in unit costs for taking merchandise that will soon be replaced by new and improved versions of the original product.F) B) and E)
G) A) and B)

Exam 12: Pricing Products and Services

Tara is enrolled for spring semester at college.The tuition is $6,000 but she has a scholarship for $1,000 as well as a work study grant of $1,500.The health fees and student activity fees are $150 for the semester.What is the actual price Tara is paying for the spring semester?

Correct Answer
verified

Quantity discounts refer to

Correct Answer
verified

Central Ice Machine Company is located in Omaha, Nebraska and sells Frick, Sullair, York, and Fes Fuller ammonia refrigeration parts.The company ships using FOB origin pricing.Which of the following statements about the shipment of a Frick reciprocating compressor is true?

Correct Answer
verified

Correct Answer
verified

FIGURE 12-7 -Figure 12-7 above shows that by selling 200 pictures the firm will

Correct Answer
verified

When Dell sells various laptops it also includes software as part of the package.This is an example of

Correct Answer
verified

The purpose of a cash discount is to

Correct Answer
verified

A new car dealer can offer a reduction in the list price of a new Ford pickup truck by offering you a __________ of $1,000 for your 1998 Nissan.

Correct Answer
verified

FIGURE 12-7 -According to Figure 12-7 above, how much profit will the firm make if it sells 400 pictures?

Correct Answer
verified

FIGURE 12-6 -A shift of the demand curve from D1 to D2 in Figure 12-6 above is referred to as

Correct Answer
verified

FIGURE 12-4 -Position "B" in Figure 12-4 above represents the price premium of which of the following?

Correct Answer
verified

Setting different prices for products and services depending on individual buyers and purchase situations is referred to as

Correct Answer
verified

Bundle pricing refers to

Correct Answer
verified

A buying situation can involve comparing the costs and benefits of substitute items-such as real sugar to the sugar substitute Equal which, although more expensive than sugar, is purchased by many consumers because it contains no calories.This situation involves the consumer considering

Correct Answer
verified

According to Vizio, "The whole goal is to ensure that we have the right product, at the right time and the right price and ________."

Correct Answer
verified

Explain the price equation in the context of a new car purchase.

Correct Answer
verified
The price equation is price = [list pric...
View Answer

Marketing two or more products in a single package price is referred to as

Correct Answer
verified

Three different objectives relate to a firm's profit, which is often measured in terms of return on investment.One objective, known as _________, is where a company gives up immediate profit in exchange for achieving a higher market share in the hopes of penetrating competitive markets.

Correct Answer
verified

Which of the following is a cost-oriented approach to pricing?

Correct Answer
verified

Correct Answer
verified

Exam 12: Pricing Products and Services

Tara is enrolled for spring semester at college.The tuition is $6,000 but she has a scholarship for $1,000 as well as a work study grant of $1,500.The health fees and student activity fees are $150 for the semester.What is the actual price Tara is paying for the spring semester?

Correct AnswerverifiedShow Answer

Quantity discounts refer to

Correct AnswerverifiedShow Answer

Central Ice Machine Company is located in Omaha, Nebraska and sells Frick, Sullair, York, and Fes Fuller ammonia refrigeration parts.The company ships using FOB origin pricing.Which of the following statements about the shipment of a Frick reciprocating compressor is true?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

FIGURE 12-7 -Figure 12-7 above shows that by selling 200 pictures the firm will

Correct AnswerverifiedShow Answer

When Dell sells various laptops it also includes software as part of the package.This is an example of

Correct AnswerverifiedShow Answer

The purpose of a cash discount is to

Correct AnswerverifiedShow Answer

A new car dealer can offer a reduction in the list price of a new Ford pickup truck by offering you a __________ of $1,000 for your 1998 Nissan.

Correct AnswerverifiedShow Answer

FIGURE 12-7 -According to Figure 12-7 above, how much profit will the firm make if it sells 400 pictures?

Correct AnswerverifiedShow Answer

FIGURE 12-6 -A shift of the demand curve from D1 to D2 in Figure 12-6 above is referred to as

Correct AnswerverifiedShow Answer

FIGURE 12-4 -Position "B" in Figure 12-4 above represents the price premium of which of the following?

Correct AnswerverifiedShow Answer

Setting different prices for products and services depending on individual buyers and purchase situations is referred to as

Correct AnswerverifiedShow Answer

Bundle pricing refers to

Correct AnswerverifiedShow Answer

A buying situation can involve comparing the costs and benefits of substitute items-such as real sugar to the sugar substitute Equal which, although more expensive than sugar, is purchased by many consumers because it contains no calories.This situation involves the consumer considering

Correct AnswerverifiedShow Answer

According to Vizio, "The whole goal is to ensure that we have the right product, at the right time and the right price and ________."

Correct AnswerverifiedShow Answer

Explain the price equation in the context of a new car purchase.

Correct AnswerverifiedThe price equation is price = [list pric...View AnswerShow Answer

Marketing two or more products in a single package price is referred to as

Correct AnswerverifiedShow Answer

Three different objectives relate to a firm's profit, which is often measured in terms of return on investment.One objective, known as _________, is where a company gives up immediate profit in exchange for achieving a higher market share in the hopes of penetrating competitive markets.

Correct AnswerverifiedShow Answer

Which of the following is a cost-oriented approach to pricing?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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The price equation is price = [list pric...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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