QUESTION 1

Compared with other methods used to set prices, _______ pricing is relatively simple.

Question 1 options:

A)

improvement value

B)

value-based

C)

cost of ownership

D)

cost-based

Question 2

Gray markets can be challenging to marketers because they

Question 2 options:

A)

are legal only in select states.

B)

are just as illegal as black markets.

C)

may smear the manufacturer’s image.

D)

lack consumer support.

Question 3

Unlike product, promotion, or place, price is the only part of the marketing mix that

Question 3 options:

A)

leads to competition.

B)

generates revenue.

C)

is determined by the consumer.

D)

is subject to gray market manipulation.

Question 4

At the break-even point, _______ are zero.

Question 4 options:

A)

prices

B)

profits

C)

contributions per unit

D)

costs

Question 5

Bryce would love to own a Lamborghini someday, but he knows if he has to ask how much they cost, he probably can’t afford it today. Products like Lamborghini automobiles are most likely to be associated with

Question 5 options:

A)

break-even point pricing.

B)

cross-shopping.

C)

target return value.

D)

prestige pricing.

Question 6

Labor, materials, and energy are typically _______ costs.

Question 6 options:

A)

inelastic

B)

fixed

C)

incidental

D)

variable

Question 7

Matthew told the manager of his gas station to always adjust prices to match those charged by the other convenience store across the street. Matthew is using a _______ pricing strategy.

Question 7 options:

A)

maximizing profits

B)

target profit

C)

status quo

D)

sales

Question 8

The process of charging different prices for goods or services based on the type of customer, level of demand, or time of the day, week, or season is referred to as

Question 8 options:

A)

the target return effect.

B)

dynamic pricing.

C)

the substitution effect.

D)

cross-price elasticity.

Question 9

Tess is the marketing manager for a fast-food restaurant chain. She uses a target return pricing strategy because her firm’s primary objective is to

Question 9 options:

A)

build customer satisfaction.

B)

increase profits.

C)

increase sales.

D)

decrease competition.

Question 10

In general, prices should not be based on costs because

Question 10 options:

A)

consumers make their purchase decisions based on perceived value.

B)

consumers are cost-conscious.

C)

customers are always right.

D)

producers need to avoid creating a cost competitive parity debate.

Question 11

Customers must see value in a product or service before they’re willing to exchange time or money to obtain it, but not all customers see the same value in a product. To analyze how many units will be sold at any given price point, marketers draw on

Question 11 options:

A)

multiple regression analyses.

B)

a demand curve.

C)

the law of averages.

D)

target return strategies.

Question 12

Frank was known for driving 30 miles just to save a dollar on the price of his favorite beverage. Frank perceived price as _______ for a good or service, while most consumers recognize price as the _______ made to acquire a good or service.

Question 12 options:

A)

a variable cost; fixed cost

B)

the overall sacrifice; monetary payment

C)

the break-even amount; total cost

D)

the money paid; overall sacrifice

Question 13

A strategy of setting prices based on how customers develop their perceptions of value can often be the most effective pricing strategy, especially if the strategy

Question 13 options:

A)

is supported by consistent advertising and distribution strategies.

B)

challenges consumers to discard their perceptions of value.

C)

is measured against the competition.

D)

leads the marketer to be the low-cost seller.

Question 14

There’s an old saying, “If you have to ask the price of a yacht, you can’t afford it.” Products like yachts are most likely to be associated with

Question 14 options:

A)

prestige pricing.

B)

cross-shopping.

C)

break-even point pricing.

D)

competitive parity pricing.

Question 15

_______ measures consumers’ sensitivity to changes in how much is charged for an item.

Question 15 options:

A)

Competitive price demand

B)

Income elasticity

C)

Cross-price elasticity of demand

D)

Price elasticity of demand

Question 16

Jacob rents rooms in his hotel for an average of $100 per night. The variable cost per rented room is $15. His fixed costs are $100,000, and his profit last year was $20,000. For Jacob, the contribution per unit is

Question 16 options:

A)

$20,000.

B)

$100.

C)

$85.

D)

$1,000.

Question 17

In many high-end resort markets, Westin hotels compete directly with Crowne Plaza hotels. When it comes to pricing, Westin tends to charge its guests similar rates to what the Crowne Plaza hotels charge. Westin is using a _______ pricing strategy.

Question 17 options:

A)

maximizing profits

B)

sales oriented

C)

target profit

D)

competitive parity

Question 18

Claire tells her sales representatives the goal is to generate at least a 15 percent return on investment for all the computer desks they sell. Claire is using a _______ pricing strategy.

Question 18 options:

A)

target return

B)

sales orientation

C)

status quo

D)

target profit

Question 19

If all three grocery stores in town decide to charge the same price for a loaf of bread, what type of pricing tactic is being used?

Question 19 options:

A)

Horizontal price fixing

B)

Vertical price discrimination

C)

Loss-leader pricing

D)

Vertical price fixing

Question 20

Ryan gave the manager of his convenience store a set of binoculars so she could see the gasoline prices charged by the other convenience store at that intersection. Ryan told the manager always to match the gasoline prices of the other store. Ryan is using a _______ pricing strategy.

Question 20 options:

A)

status quo

B)

target profit

C)

maximizing profits

D)

sales