Question 1

According to the textbook,which industry typically adopts an experience curve pricing approach?

Accepted Answer

A)  advertising
B)  space exploration
C)  ready-to-eat cereal
D)  electronics
E)  miningF) A) and D)
G) A) and C) D

Question 2

Setting a price to achieve an annual target return-on-investment (ROI) is referred to as

Accepted Answer

A)  target return-on-investment pricing.
B)  target return-on-profit pricing.
C)  target return-on-sales pricing.
D)  target profit pricing.
E)  customary pricing.F) All of the above
G) D) and E)

Question 3

A box of Cascade dishwasher detergent shrink-wrapped with a bottle of Jet Dry is sold for $1.50 less than the regular price of the products sold separately.This is an example of ________ pricing.

Accepted Answer

A)  penetration
B)  prestige
C)  bundle
D)  odd-even
E)  standard markupF) None of the above
G) A) and B)

Question 4

Setting prices a few dollars or cents under an even number is referred to as

Accepted Answer

A)  odd-even pricing.
B)  prestige pricing.
C)  price lining.
D)  above-,at-,or below-market pricing.
E)  every day fair pricing.F) B) and E)
G) A) and C)

Question 5

Standard markup pricing refers to

Accepted Answer

A)  adjusting the price of a product so it is "in line" with that of its largest competitor.
B)  setting the price of a line of products at a number of different price points.
C)  setting prices to achieve a profit that is a specified percentage of the sales volume.
D)  increasing the price slightly to protect against undue profit losses from unforeseen environmental forces.
E)  adding a fixed percentage to the cost of all items in a specific product class.F) C) and E)
G) A) and D)

Question 6

A claim that a price is below a manufacturer's suggested or list price may be deceptive if

Accepted Answer

A)  the items for sale had been purchased from another retailer.
B)  the items for sale were part of a manufacturer's promotional allowance.
C)  the items were part of a bulk order.
D)  few or no sales occur at that price in a retailer's market area.
E)  the items were purchased from the manufacturer at a higher price and the sale was part of a loss-leader promotion.F) All of the above
G) B) and C)

Question 7

If the cash discount terms for a $500 purchase are 4/10 net 30,the number 10 refers to

Accepted Answer

A)  the percentage discounted if the bill is paid within 30 days.
B)  the percentage increase in price if the bill is not paid within 10 days.
C)  the number of days for which the discount is valid.
D)  the discount in dollars per unit if the order is paid on time within 30 days.
E)  the penalty in dollars if the bill is not paid within 10 days.F) A) and E)
G) A) and D)

Question 8

A construction company was offered a 3 percent reduction in price off all invoices from a lumberyard for paying within 10 days of issue.The lumberyard was offering a

Accepted Answer

A)  trade discount.
B)  cash discount.
C)  promotional allowance.
D)  rebate.
E)  flexible price.F) A) and B)
G) B) and E)

Question 9

Skimming pricing is a strategy that introduces a new or innovative product by

Accepted Answer

A)  following a price elastic strategy.
B)  creating multiple price points.
C)  setting a high initial price.
D)  setting a low initial price.
E)  setting the price at the average of competitors' prices.F) A) and E)
G) B) and C)

Question 10

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

Accepted Answer

A)  the oldest product item in the line.
B)  the premium item in the line in terms of quality and features.
C)  the largest selling product item in the line.
D)  the loss-leader item for the rest of the product line.
E)  the most price-insensitive product item in the line.F) B) and E)
G) C) and D)

Question 11

Figure 14-2
 
-Figure 14-2 above represents the four approaches to selecting an appropriate price level.Box B represents which approach?

Accepted Answer

A)  cost-oriented
B)  profit-oriented
C)  competition-oriented
D)  demand-oriented
E)  results-orientedF) All of the above
G) B) and E)

Question 12

What is loss-leader pricing and why do retailers use it?

Accepted Answer

For a special promotion,many retail stor...

Question 13

One problem in the interstate trucking industry is the number of trucks that return empty after making a delivery.There is a website where independent interstate truckers can look for loads to carry on their return trips,known as backhauls.Because the trucks would normally return empty,truckers who use this website to generate business they would not have had otherwise receive a reduced shipping rate.This reduced rate for a backhaul is an example of

Accepted Answer

A)  penetration pricing.
B)  target pricing.
C)  cost-plus pricing.
D)  odd-even pricing.
E)  yield management pricing.F) All of the above
G) A) and B)

Question 14

Odd-even pricing refers to

Accepted Answer

A)  setting prices one way for product lines and another way for individual brands.
B)  setting prices of luxury items at even price points and setting the price of necessities at odd price points.
C)  setting prices a few dollars or cents under an odd number.
D)  adding a fixed percentage to the cost of all items in a specific product class.
E)  setting prices a few dollars or cents under an even number.F) None of the above
G) A) and B)

Question 15

Explain the deceptive pricing practice known as bait and switch.

Accepted Answer

One common deceptive pricing practice is known as bait and switch;for example,advertising a very low price on a microwave oven to attract customers to the store but persuading them to buy a more expensive model by (a)ridiculing the advertised model or (b)not having the advertised model in stock.

Question 16

Customary pricing refers to

Accepted Answer

A)  a pricing method where the price the seller quotes includes all transportation costs.
B)  setting the same price for similar customers who buy the same product and quantities under the same conditions.
C)  deliberately selling a product below its list price to attract attention to it.
D)  setting a price that is dictated by tradition,a standardized channel of distribution,or other competitive factors.
E)  pricing based on what the market will bear.F) A) and D)
G) C) and E)

Question 17

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

Accepted Answer

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

Question 18

Carmex uses all of the following approaches to setting the price of its products except which?

Accepted Answer

A)  profit-oriented
B)  competition-oriented
C)  cost-oriented
D)  elasticity-oriented
E)  demand-orientedF) B) and D)
G) B) and C) D

Question 19

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) A) and B)
G) All of the above

Question 20

The Robinson-Patman Act covers promotional allowances as well as discounts.To legally offer promotional allowances to buyers,the seller must do so on a(n) ________ basis to all buyers distributing the seller's products.

Accepted Answer

A)  proportionally equal
B)  limited
C)  disproportionally equal
D)  geographical
E)  across-the-boardF) A) and E)
G) A) and C)

Exam 14: Arriving at the Final Price

According to the textbook,which industry typically adopts an experience curve pricing approach?

Correct Answer
verified
D

Setting a price to achieve an annual target return-on-investment (ROI) is referred to as

Correct Answer
verified

A box of Cascade dishwasher detergent shrink-wrapped with a bottle of Jet Dry is sold for $1.50 less than the regular price of the products sold separately.This is an example of ________ pricing.

Correct Answer
verified

Setting prices a few dollars or cents under an even number is referred to as

Correct Answer
verified

Standard markup pricing refers to

Correct Answer
verified

A claim that a price is below a manufacturer's suggested or list price may be deceptive if

Correct Answer
verified

If the cash discount terms for a $500 purchase are 4/10 net 30,the number 10 refers to

Correct Answer
verified

A construction company was offered a 3 percent reduction in price off all invoices from a lumberyard for paying within 10 days of issue.The lumberyard was offering a

Correct Answer
verified

Skimming pricing is a strategy that introduces a new or innovative product by

Correct Answer
verified

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

Correct Answer
verified

Figure 14-2 -Figure 14-2 above represents the four approaches to selecting an appropriate price level.Box B represents which approach?

Correct Answer
verified

What is loss-leader pricing and why do retailers use it?

Correct Answer
verified
For a special promotion,many retail stor...
View Answer

Correct Answer
verified

Odd-even pricing refers to

Correct Answer
verified

Explain the deceptive pricing practice known as bait and switch.

Customary pricing refers to

Correct Answer
verified

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

Correct Answer
verified

Carmex uses all of the following approaches to setting the price of its products except which?

Correct Answer
verified
D

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

Correct Answer
verified

The Robinson-Patman Act covers promotional allowances as well as discounts.To legally offer promotional allowances to buyers,the seller must do so on a(n) ________ basis to all buyers distributing the seller's products.

Correct Answer
verified

Exam 14: Arriving at the Final Price

According to the textbook,which industry typically adopts an experience curve pricing approach?

Correct AnswerverifiedD

Setting a price to achieve an annual target return-on-investment (ROI) is referred to as

Correct AnswerverifiedShow Answer

A box of Cascade dishwasher detergent shrink-wrapped with a bottle of Jet Dry is sold for $1.50 less than the regular price of the products sold separately.This is an example of ________ pricing.

Correct AnswerverifiedShow Answer

Setting prices a few dollars or cents under an even number is referred to as

Correct AnswerverifiedShow Answer

Standard markup pricing refers to

Correct AnswerverifiedShow Answer

A claim that a price is below a manufacturer's suggested or list price may be deceptive if

Correct AnswerverifiedShow Answer

If the cash discount terms for a $500 purchase are 4/10 net 30,the number 10 refers to

Correct AnswerverifiedShow Answer

A construction company was offered a 3 percent reduction in price off all invoices from a lumberyard for paying within 10 days of issue.The lumberyard was offering a

Correct AnswerverifiedShow Answer

Skimming pricing is a strategy that introduces a new or innovative product by

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 14-2 -Figure 14-2 above represents the four approaches to selecting an appropriate price level.Box B represents which approach?

Correct AnswerverifiedShow Answer

What is loss-leader pricing and why do retailers use it?

Correct AnswerverifiedFor a special promotion,many retail stor...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Odd-even pricing refers to

Correct AnswerverifiedShow Answer

Explain the deceptive pricing practice known as bait and switch.

Customary pricing refers to

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Carmex uses all of the following approaches to setting the price of its products except which?

Correct AnswerverifiedD

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

Correct AnswerverifiedShow Answer

The Robinson-Patman Act covers promotional allowances as well as discounts.To legally offer promotional allowances to buyers,the seller must do so on a(n) ________ basis to all buyers distributing the seller's products.

Correct AnswerverifiedShow Answer

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D

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For a special promotion,many retail stor...
View Answer

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D

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Correct Answer
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