Question 1

Which of the following statements regarding a trade-in allowance is most accurate?

Accepted Answer

A)  A trade-in allowance is a noncash exchange of one product for another of equal or lesser value.
B)  A trade-in allowance is an effective way to lower the price a buyer has to pay without formally reducing the list price.
C)  A trade-in allowance is a cash-back payment when a more expensive item is replaced with a less expensive one.
D)  A trade-in allowance is the return of money based on proof of purchase.
E)  A trade-in allowance is a cash payment to a retailer for extra in-store support or special featuring of the brand.F) A) and B)
G) A) and C)

Question 2

A box of Cascade dishwasher detergent shrink-wrapped with a bottle of Jet Dry for 10 cents more than the regular price of the dishwasher detergent is an example of __________ pricing.

Accepted Answer

A)  penetration
B)  prestige
C)  bundle
D)  odd-even
E)  standard markupF) B) and D)
G) B) and E)

Question 3

With profit-oriented approaches to pricing, a price setter may choose to balance both __________ and __________ to set price.

Accepted Answer

A)  revenue; profit
B)  tangible goods; services
C)  cost; revenue
D)  demand; supply
E)  cost; demandF) D) and E)
G) B) and E)

Question 4

You can buy a General Electric dishwasher for $399 or you can buy a similar Bosch brand dishwasher for $989. Since Bosch uses its pricing strategy to project a high-quality product image, it is most likely using __________ pricing.

Accepted Answer

A)  bundle
B)  standard markup
C)  prestige
D)  penetration
E)  cost plus fixed-feeF) A) and B)
G) A) and C)

Question 5

Which of the four approaches does Carmex use to set prices for its products?

Accepted Answer

Carmex uses each of the four perspective...

Question 6

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

Accepted Answer

A)  everyday even lower pricing.
B)  a price war.
C)  fair trade pricing.
D)  a market war.
E)  a price reduction.F) B) and D)
G) A) and E)

Question 7

Free on board (FOB)  origin pricing is

Accepted Answer

A)  a method of pricing where the price the seller sets includes all transportation costs.
B)  a method of pricing where taxes and tariffs are adjusted based upon the city, state, or country of origin of a product and not its destination.
C)  the price the seller quotes that includes only the cost of loading the product onto or into a vehicle and specifies the name of the location where the loading is to occur (seller's factory or warehouse) .
D)  a method of pricing where taxes and tariffs are adjusted based upon the city, state, or country destination of a product and not its place of origin.
E)  the buyer's naming the location of this loading as the seller's factory or warehouse.F) D) and E)
G) All of the above

Question 8

When a firm divides its selling territory into geographic areas, it is referred to as

Accepted Answer

A)  single-zone pricing.
B)  multiple-zone pricing.
C)  geographic pricing.
D)  FOB origin pricing.
E)  basing-point pricing.F) A) and B)
G) A) and C)

Question 9

Adding a fixed percentage to the cost of all items in a specific product class is referred to as

Accepted Answer

A)  target profit pricing.
B)  standard markup pricing.
C)  target return-on-investment pricing.
D)  customary pricing.
E)  everyday low pricing.F) C) and D)
G) B) and C)

Question 10

Basing-point pricing refers to

Accepted Answer

A)  selecting a single geographical location from which the list price for products plus freight expenses are charged to the seller.
B)  selecting two or more geographical locations from which the list price for products plus freight expenses are charged to the seller.
C)  having all buyers pay the same delivered price for the products, regardless of their distance from the seller.
D)  a firm dividing a selling territory into geographic areas or zones and charging the same delivered price to all buyers within the same zone, but charging different prices in for different zones depending on distance from the factory or warehouse.
E)  selecting one or more geographical locations from which the list price for products plus freight expenses are charged to the buyer.F) C) and D)
G) All of the above

Question 11

Which of the following pricing techniques is most sensitive to customers' responses to price?

Accepted Answer

A)  cost-plus percentage-of-cost pricing
B)  target pricing
C)  experience curve pricing
D)  cost-plus fixed-fee pricing
E)  standard markup pricingF) B) and E)
G) A) and B)

Question 12

Which of the following statements about everyday low pricing (EDLP)  is most accurate?

Accepted Answer

A)  For supermarkets, EDLP means "everyday low profits!"
B)  Supermarkets have hailed EDLP as value pricing at its most effective.
C)  EDLP allows supermarkets to use deeply discounted price specials.
D)  EDLP can increase average retail prices by as much as 10 percent.
E)  If retailers pass on their allowances to customers, they cannot make a profit.F) C) and D)
G) A) and B)

Question 13

Controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price is called

Accepted Answer

A)  competitive collusion.
B)  price cooperation.
C)  horizontal price fixing.
D)  lateral price fixing.
E)  vertical price fixing.F) A) and C)
G) All of the above

Question 14

Manufacturers of private brands use which method of competition-oriented pricing?

Accepted Answer

A)  penetration pricing
B)  below-market pricing
C)  loss-leader pricing
D)  prestige pricing
E)  skimming pricingF) C) and D)
G) A) and D)

Question 15

With the introduction of e-books, distributors could still set their own retail prices, but with a restriction. Distributors could set prices below a publisher's retail list price so long as they

Accepted Answer

A)  matched the commission received from a publisher.
B)  exceeded the commission received from a publisher.
C)  did not exceed the commission received from a publisher.
D)  did not increase prices to the readers.
E)  prevented discounts to competitors.F) C) and D)
G) None of the above

Question 16

Cost-plus pricing refers to

Accepted Answer

A)  summing the total unit cost of providing a product or service and adding a specific amount to the cost to arrive at the price.
B)  setting the price of a line of products at a number of different price points.
C)  adding a fixed percentage to the cost of all items in a specific product class.
D)  setting prices to achieve a profit that is a specified percentage of the sales volume.
E)  increasing the price slightly to protect against undue profit losses from unforeseen environmental forces.F) D) and E)
G) A) and E)

Question 17

A discount that is based on the size of an individual purchase order rather than a series of repeat orders is referred to as

Accepted Answer

A)  a cumulative quantity discount.
B)  bundle pricing.
C)  an economic order discount.
D)  a noncumulative quantity discount.
E)  a promotional allowance.F) A) and D)
G) A) and B)

Question 18

A retailer purchased a gross (144)  of silk shells each costing exactly $17. Although the only difference between the shells was color, when they were put on the floor, the primary colors were marked $25, the pastel colors were marked $28, and the black and white shells were marked $30. These prices were set most likely because

Accepted Answer

A)  retailers using a price lining strategy will occasionally mark up items based on color, style, and expected consumer demand.
B)  fewer people buy black and white shells, so the retailer has to charge a higher price to break even.
C)  the retailer is using prestige pricing; black and white shells are more elegant.
D)  the primary colors were priced using a penetration strategy, the pastels were priced using a skimming strategy, and the black and white shells were priced using prestige pricing.
E)  price lining is essentially the same as above-, at-, or below market pricing.F) A) and D)
G) A) and C)

Question 19

A fixed-price policy refers to

Accepted Answer

A)  setting different prices for products and services in real time in response to supply and demand conditions.
B)  setting the price of an entire line of products at a single specific pricing point.
C)  simultaneously setting prices for all items in a product line to cover the total cost and produce a profit for the complete line, not necessarily for each item.
D)  adding a fixed percentage to the cost of all items in a specific product class.
E)  setting one price for all buyers of a product or service.F) A) and E)
G) All of the above

Question 20

When Kroger, a national supermarket chain, uses a special promotion to price a six-pack of soda at $2.09 (which is below its customary price level of $4.29) , it is attempting to

Accepted Answer

A)  drive its competition out of business.
B)  attract customers in hopes they will buy other products as well.
C)  fill its parking lot so its store will look successful.
D)  work with the local bottler to move products that are close to their expiration dates.
E)  help stimulate the local economy and generate good will with its customers.F) B) and D)
G) C) and E)

Exam 14: Arriving at the Final Price

A box of Cascade dishwasher detergent shrink-wrapped with a bottle of Jet Dry for 10 cents more than the regular price of the dishwasher detergent is an example of __________ pricing.

Correct Answer
verified

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

Correct Answer
verified

Adding a fixed percentage to the cost of all items in a specific product class is referred to as

Correct Answer
verified

Which of the following statements about everyday low pricing (EDLP) is most accurate?

Correct Answer
verified

Free on board (FOB) origin pricing is

Correct Answer
verified

Controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price is called

Correct Answer
verified

A fixed-price policy refers to

Correct Answer
verified

With profit-oriented approaches to pricing, a price setter may choose to balance both and to set price.

Correct Answer
verified

Basing-point pricing refers to

Correct Answer
verified

Which of the following pricing techniques is most sensitive to customers' responses to price?

Correct Answer
verified

With the introduction of e-books, distributors could still set their own retail prices, but with a restriction. Distributors could set prices below a publisher's retail list price so long as they

Correct Answer
verified

Which of the four approaches does Carmex use to set prices for its products?

Correct Answer
verified
Carmex uses each of the four perspective...
View Answer

When Kroger, a national supermarket chain, uses a special promotion to price a six-pack of soda at $2.09 (which is below its customary price level of $4.29) , it is attempting to

Correct Answer
verified

Which of the following statements regarding a trade-in allowance is most accurate?

Correct Answer
verified

You can buy a General Electric dishwasher for $399 or you can buy a similar Bosch brand dishwasher for $989. Since Bosch uses its pricing strategy to project a high-quality product image, it is most likely using __________ pricing.

Correct Answer
verified

When a firm divides its selling territory into geographic areas, it is referred to as

Correct Answer
verified

Correct Answer
verified

Cost-plus pricing refers to

Correct Answer
verified

Manufacturers of private brands use which method of competition-oriented pricing?

Correct Answer
verified

A discount that is based on the size of an individual purchase order rather than a series of repeat orders is referred to as

Correct Answer
verified

Exam 14: Arriving at the Final Price

A box of Cascade dishwasher detergent shrink-wrapped with a bottle of Jet Dry for 10 cents more than the regular price of the dishwasher detergent is an example of __________ pricing.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Adding a fixed percentage to the cost of all items in a specific product class is referred to as

Correct AnswerverifiedShow Answer

Which of the following statements about everyday low pricing (EDLP) is most accurate?

Correct AnswerverifiedShow Answer

Free on board (FOB) origin pricing is

Correct AnswerverifiedShow Answer

Controlling agreements between independent buyers and sellers whereby sellers are required to not sell products below a minimum retail price is called

Correct AnswerverifiedShow Answer

A fixed-price policy refers to

Correct AnswerverifiedShow Answer

With profit-oriented approaches to pricing, a price setter may choose to balance both __________ and __________ to set price.

Correct AnswerverifiedShow Answer

Basing-point pricing refers to

Correct AnswerverifiedShow Answer

Which of the following pricing techniques is most sensitive to customers' responses to price?

Correct AnswerverifiedShow Answer

With the introduction of e-books, distributors could still set their own retail prices, but with a restriction. Distributors could set prices below a publisher's retail list price so long as they

Correct AnswerverifiedShow Answer

Which of the four approaches does Carmex use to set prices for its products?

Correct AnswerverifiedCarmex uses each of the four perspective...View AnswerShow Answer

When Kroger, a national supermarket chain, uses a special promotion to price a six-pack of soda at $2.09 (which is below its customary price level of $4.29) , it is attempting to

Correct AnswerverifiedShow Answer

Which of the following statements regarding a trade-in allowance is most accurate?

Correct AnswerverifiedShow Answer

You can buy a General Electric dishwasher for $399 or you can buy a similar Bosch brand dishwasher for $989. Since Bosch uses its pricing strategy to project a high-quality product image, it is most likely using __________ pricing.

Correct AnswerverifiedShow Answer

When a firm divides its selling territory into geographic areas, it is referred to as

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Cost-plus pricing refers to

Correct AnswerverifiedShow Answer

Manufacturers of private brands use which method of competition-oriented pricing?

Correct AnswerverifiedShow Answer

A discount that is based on the size of an individual purchase order rather than a series of repeat orders is referred to as

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

With profit-oriented approaches to pricing, a price setter may choose to balance both and to set price.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Carmex uses each of the four perspective...
View Answer

Correct Answer
verified

Correct Answer
verified

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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