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Exam 14: Arriving at the Final Price

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Question 21

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Charging different prices to maximize revenue for a set amount of capacity at any given time is referred to as

A) demand backward pricing.
B) target pricing.
C) skimming pricing.
D) yield management pricing.
E) penetration pricing.

F) B) and D)
G) C) and D)

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Question 22

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Manufacturers use seasonal discounts to

A) get rid of expired merchandise.
B) prevent retailers from purchasing competitors' products.
C) extend the peak seasonal selling season.
D) encourage buyers to stock inventory earlier than their normal demand would require.
E) temporarily spur primary demand during periods of soft sales, such as the beginning of a month, after which prices will return to normal when selective demand picks up.

F) C) and D)
G) B) and C)

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Question 23

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penetration pricing policy is MOST LIKELY to be effective when: (1) __________; (2) unit production and marketing costs fall dramatically as production volume increases; and (3) many segments of the market are price sensitive.

Advertising such as "Retail Value $100,Our Price $85" is deceptive if

of the following are cost-oriented approaches to select an approximate price level EXCEPT:

of the following are demand-oriented approaches to selecting an approximate price level EXCEPT:

Figure 14-1 -Figure 14-1 above represents the six steps in the price-setting process.Which letter represents the step where a firm would establish a one price or flexible price policy?

Price Premium Marketing Dashboard -Price Premium Marketing Dashboard above shows the dollar and unit market shares for selected energy drinks.What is the price premium for Red Bull in 2010?

Wrigley recently introduced a new flavor of Orbit brand sugar free chewing gum-mint mojito.The introductory price was low so that it quickly created loyal customers for the flavor.In this example,Wrigley used

Different brands within a company's product line generally have different profit margins; for example,items with higher price lines have higher profit margins.Nike Variety tennis shoes have variable costs of $6 and sell for $24,whereas Nike Wimbledon tennis shoes have variable costs of $38 and sell for $48,but when fixed overhead is added,the shoe is unprofitable by $2 per pair.Which statement is most accurate regarding Nike's pricing approach with these two product lines?

pricing method where a supplier is reimbursed for all costs,regardless of what they may be,and is allowed a fixed fee as profit that is independent of the final cost of the project is referred to as

successive price cutting by competitors to increase or maintain their unit sales or market share is referred to as

Geographical Pricing Map B -According to the Geographical Pricing Map B above,if the plant in Denver ships its products to all of the identified cities at different prices based on distance as indicated by the color-coded regions,it is most likely using which type of pricing?

Another name for a one-price policy is

method of pricing where the price the seller quotes includes only the cost of loading the product onto the vehicle and specifies the name of the location where the loading is to occur is referred to as

Which pricing approach complements the demand-oriented pricing strategy of skimming followed by penetration pricing?

Figure 14-1 -According to Figure 14-1 above,"F" represents which step in the price-setting process?

purpose of a cash discount is to

penetration pricing policy is MOST LIKELY to be effective when

Standard markup pricing refers to