Question 1

Bundle pricing refers to

Accepted Answer

A)  an extra amount of "free goods" awarded sellers in the channel of distribution for promoting a product.
B)  marketing two or more products in a single package price.
C)  using BOGOs-requiring customers to "buy one to get one free" as a strategy to increase sales and profits.
D)  setting the price of a line of products at two specific pricing points.
E)  the practice of charging two or more prices depending upon the outlet carrying the product.F) B) and E)
G) None of the above

Question 2

Five pricing practices are scrutinized because of potential unethical or illegal actions. They are (1)  price fixing, (2)  price discrimination, (3)  deceptive pricing, (4)  predatory pricing, and (5)  __________.

Accepted Answer

A)  geographical pricing
B)  price discounting
C)  lateral price fixing
D)  delayed payment penalties
E)  price discriminationF) A) and E)
G) All of the above

Question 3

Architectural firms that specialize in designing and constructing one-of-a-kind custom buildings such as the Rock Hall of Fame often use which pricing strategy?

Accepted Answer

A)  cost-plus pricing
B)  experience curve pricing
C)  standard markup pricing
D)  yield management pricing
E)  price liningF) A) and D)
G) A) and C)

Question 4

When establishing product-line pricing, the lowest-priced item is typically positioned as

Accepted Answer

A)  the youngest product item in the line.
B)  the smallest selling product item in the line.
C)  the lost-cost item in the line in terms of quality and features.
D)  the profit leader for the rest of the product line.
E)  the traffic builder designed to capture the attention of first-time buyers.F) B) and E)
G) A) and E)

Question 5

Prestige pricing refers to

Accepted Answer

A)  charging different prices to different buyers for goods of like grade and quality.
B)  setting a low initial price on a new product to appeal immediately to the mass market odd-even pricing.
C)  setting a market price for a product or product class based on a subjective feel for the competitors' price or market price.
D)  setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it.
E)  setting a price that is dictated by tradition, a standardized channel of distribution, or other competitive factors.F) D) and E)
G) B) and E)

Question 6

Product-line pricing involves determining (1)  the lowest-priced product and price; (2)  the highest-priced product and price; and (3)  __________.

Accepted Answer

A)  the single most popular item in the line
B)  the least vulnerable product in the line
C)  the most frequently sold product in the line
D)  the most price-insensitive product in the line
E)  the price differentials for all other products in the lineF) A) and B)
G) A) and C)

Question 7

A method of pricing where the price the seller quotes includes all transportations costs, and the seller is responsible for any damage that may occur because the seller retains title to the goods until delivered to the buyer, is referred to as

Accepted Answer

A)  FOB destination pricing.
B)  FOB origin pricing.
C)  geographical allowance.
D)  uniform delivered pricing.
E)  transportation allowance.F) B) and C)
G) B) and E)

Question 8

A reduction from the list price that a seller gives a buyer as a reward for some activity of the buyer that is favorable to the seller is called

Accepted Answer

A)  the pretax price.
B)  the list price.
C)  the manufacturer's suggested retail price (MSRP) .
D)  a discount.
E)  a trade-in allowance.F) A) and C)
G) B) and D)

Question 9

With cost-oriented approaches to pricing, a price setter stresses the __________ side of the pricing problem, not the __________ side.

Accepted Answer

A)  cost; revenue
B)  cost; demand
C)  cost; profit
D)  cost; supply
E)  cost; serviceF) B) and D)
G) A) and D)

Question 10

According to the textbook, clothing manufacturer Christian Dior and retailer Neiman Marcus use __________ pricing.

Accepted Answer

A)  above-market
B)  at-market
C)  below-market
D)  prestige pricing
E)  everyday low pricingF) None of the above
G) B) and C)

Question 11

A company in Virginia that manufactures and sells peanut brittle to retailers charges higher shipping costs for orders sent to customers living west of the Mississippi River. This Virginia company is using

Accepted Answer

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

Question 12

Yield management pricing is most consistent with services trying to deal with

Accepted Answer

A)  perceived risk.
B)  capacity management.
C)  cognitive dissonance.
D)  inelasticity of demand.
E)  new product strategy development.F) B) and C)
G) C) and D)

Question 13

The Swedish manufacturer of Asko dishwashers concluded that consumers would be willing to pay approximately $989 for a dishwasher that was quieter than any other dishwasher on the market. Based on this price, Asko determined the margins that would have to be given to wholesalers and retailers to arrive at the $989 retail price. Asko used

Accepted Answer

A)  prestige pricing.
B)  price lining.
C)  cost-plus pricing.
D)  target pricing.
E)  customary pricing.F) A) and E)
G) B) and E)

Question 14

A manufacturer offers a suggested list price for a cashmere sweater of $250. The trade discount is 40/20/10. What amount does the manufacturer expect to receive for the sweater?

Accepted Answer

A)  $175.00
B)  $225.00
C)  $108.00
D)  $125.00
E)  $100.00F) B) and E)
G) C) and D)

Question 15

The prices for all furniture sold at American Furniture Warehouse end in $9.99, such as $599.99, $899.99, etc. American Furniture Warehouse uses

Accepted Answer

A)  odd-even pricing.
B)  dynamic pricing.
C)  price lining.
D)  bundle pricing.
E)  product-line pricing.F) A) and B)
G) A) and C)

Question 16

The two forms of cost-plus pricing are

Accepted Answer

A)  cost-plus-fixed-fee pricing and cost-plus-variable-fee pricing.
B)  cost-plus-ROI pricing and cost-minus-ROI pricing.
C)  target return on sales pricing and target return on investment pricing.
D)  cost-plus-percentage-of-cost pricing and cost-plus-fixed-fee pricing.
E)  dynamic pricing and flexible pricing.F) A) and B)
G) B) and D)

Question 17

The practice of charging different prices to different buyers for goods of like grade and quality is referred to as

Accepted Answer

A)  horizontal price fixing.
B)  resale price maintenance.
C)  price discrimination.
D)  predatory pricing.
E)  bait and switch pricing.F) A) and C)
G) None of the above

Question 18

Trade discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

Accepted Answer

A)  the marketing activities they are expected to perform in the future.
B)  the frequency of the order.
C)  when orders are placed during the year.
D)  the length of the relationship with the manufacturer.
E)  the size of the order.F) A) and B)
G) A) and C)

Question 19

A trade-in allowance is

Accepted Answer

A)  a noncash exchange of one product for another of equal or greater value.
B)  a cash-back payment when a more expensive item is replaced with a less expensive item.
C)  the return of money based on proof of purchase.
D)  a cash payment to a retailer for extra in-store support or special featuring of the brand.
E)  a price reduction given when a used product is part of the payment on a new product.F) B) and D)
G) A) and D)

Question 20

A manufacturer using __________ is setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it.

Accepted Answer

A)  skimming pricing
B)  penetration pricing
C)  price lining
D)  odd-even pricing
E)  prestige pricingF) A) and B)
G) A) and D)

Exam 14: Arriving at the Final Price

According to the textbook, clothing manufacturer Christian Dior and retailer Neiman Marcus use __________ pricing.

Correct Answer
verified

A manufacturer offers a suggested list price for a cashmere sweater of $250. The trade discount is 40/20/10. What amount does the manufacturer expect to receive for the sweater?

Correct Answer
verified

The two forms of cost-plus pricing are

Correct Answer
verified

A reduction from the list price that a seller gives a buyer as a reward for some activity of the buyer that is favorable to the seller is called

Correct Answer
verified

Product-line pricing involves determining (1) the lowest-priced product and price; (2) the highest-priced product and price; and (3) __________.

Correct Answer
verified

Bundle pricing refers to

Correct Answer
verified

When establishing product-line pricing, the lowest-priced item is typically positioned as

Correct Answer
verified

Correct Answer
verified

A manufacturer using __________ is setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it.

Correct Answer
verified

The prices for all furniture sold at American Furniture Warehouse end in $9.99, such as $599.99, $899.99, etc. American Furniture Warehouse uses

Correct Answer
verified

A company in Virginia that manufactures and sells peanut brittle to retailers charges higher shipping costs for orders sent to customers living west of the Mississippi River. This Virginia company is using

Correct Answer
verified

A method of pricing where the price the seller quotes includes all transportations costs, and the seller is responsible for any damage that may occur because the seller retains title to the goods until delivered to the buyer, is referred to as

Correct Answer
verified

Five pricing practices are scrutinized because of potential unethical or illegal actions. They are (1) price fixing, (2) price discrimination, (3) deceptive pricing, (4) predatory pricing, and (5) __________.

Correct Answer
verified

The practice of charging different prices to different buyers for goods of like grade and quality is referred to as

Correct Answer
verified

Prestige pricing refers to

Correct Answer
verified

With cost-oriented approaches to pricing, a price setter stresses the side of the pricing problem, not the side.

Correct Answer
verified

Yield management pricing is most consistent with services trying to deal with

Correct Answer
verified

Architectural firms that specialize in designing and constructing one-of-a-kind custom buildings such as the Rock Hall of Fame often use which pricing strategy?

Correct Answer
verified

Trade discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

Correct Answer
verified

A trade-in allowance is

Correct Answer
verified

Exam 14: Arriving at the Final Price

According to the textbook, clothing manufacturer Christian Dior and retailer Neiman Marcus use __________ pricing.

Correct AnswerverifiedShow Answer

A manufacturer offers a suggested list price for a cashmere sweater of $250. The trade discount is 40/20/10. What amount does the manufacturer expect to receive for the sweater?

Correct AnswerverifiedShow Answer

The two forms of cost-plus pricing are

Correct AnswerverifiedShow Answer

A reduction from the list price that a seller gives a buyer as a reward for some activity of the buyer that is favorable to the seller is called

Correct AnswerverifiedShow Answer

Product-line pricing involves determining (1) the lowest-priced product and price; (2) the highest-priced product and price; and (3) __________.

Correct AnswerverifiedShow Answer

Bundle pricing refers to

Correct AnswerverifiedShow Answer

When establishing product-line pricing, the lowest-priced item is typically positioned as

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A manufacturer using __________ is setting a high price so that quality- or status-conscious consumers will be attracted to the product and buy it.

Correct AnswerverifiedShow Answer

The prices for all furniture sold at American Furniture Warehouse end in $9.99, such as $599.99, $899.99, etc. American Furniture Warehouse uses

Correct AnswerverifiedShow Answer

A company in Virginia that manufactures and sells peanut brittle to retailers charges higher shipping costs for orders sent to customers living west of the Mississippi River. This Virginia company is using

Correct AnswerverifiedShow Answer

A method of pricing where the price the seller quotes includes all transportations costs, and the seller is responsible for any damage that may occur because the seller retains title to the goods until delivered to the buyer, is referred to as

Correct AnswerverifiedShow Answer

Five pricing practices are scrutinized because of potential unethical or illegal actions. They are (1) price fixing, (2) price discrimination, (3) deceptive pricing, (4) predatory pricing, and (5) __________.

Correct AnswerverifiedShow Answer

The practice of charging different prices to different buyers for goods of like grade and quality is referred to as

Correct AnswerverifiedShow Answer

Prestige pricing refers to

Correct AnswerverifiedShow Answer

With cost-oriented approaches to pricing, a price setter stresses the __________ side of the pricing problem, not the __________ side.

Correct AnswerverifiedShow Answer

Yield management pricing is most consistent with services trying to deal with

Correct AnswerverifiedShow Answer

Architectural firms that specialize in designing and constructing one-of-a-kind custom buildings such as the Rock Hall of Fame often use which pricing strategy?

Correct AnswerverifiedShow Answer

Trade discounts are offered to resellers in the marketing channel on the basis of where they are in the channel and

Correct AnswerverifiedShow Answer

A trade-in allowance is

Correct AnswerverifiedShow Answer

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Correct Answer
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Correct Answer
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Correct Answer
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verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

With cost-oriented approaches to pricing, a price setter stresses the side of the pricing problem, not the side.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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