Question 1

A demand curve graph typically appears as

Accepted Answer

A)  a parabola with the apex representing the highest price that can be charged without losing customers.
B)  a diagonal line going from upper left to lower right demonstrating that as price goes down,demand goes up.
C)  an inverted parabola with the lowest point representing the lowest price that can be charged and still meet the company's profit objectives.
D)  a diagonal line going from lower left to upper right demonstrating that as prices go up,demand goes up proportionately.
E)  two intersecting lines that identify the point at which supply and demand are exactly the same.F) B) and E)
G) A) and B)

Question 2

For years,a local "greasy spoon" diner had customers lining up around the building for breakfast.When the city announced that it was building an off ramp from the highway that would conceivably double his customer traffic,the proprietor was delighted.Having saved enough in previous years,he was certain it could hold him over through the three-month construction.Unfortunately,construction delays continued for an additional six months and the work is still in progress.The best pricing objective at this point for the diner's owner would MOST LIKELY be __________.

Accepted Answer

A)  profit
B)  market share
C)  unit volume
D)  survival
E)  social responsibilityF) C) and D)
G) B) and E)

Question 3

__________ occurs when shoppers go to a store,obtain the store price of a product,scan its SKU or bar code with a smartphone camera,and go online to compare prices with those of selected competitors.

Accepted Answer

A)  Ad matching
B)  Competitive parity pricing
C)  Every day low pricing
D)  Dynamic pricing
E)  ShowroomingF) None of the above
G) A) and E)

Question 4

Acme Shoe Company sells heel replacement kits for men's shoes.It has fixed costs of $6 million and unit variable costs of $5 per kit.Suppose a consultant tells Acme that it can sell 750,000 heel repair kits.What price must Acme charge to achieve a profit of $2.5 million?

Accepted Answer

A)  $5.00
B)  $8.33
C)  $11.33
D)  $16.33
E)  $20.00F) A) and C)
G) C) and D)

Question 5

A demand curve refers to a graph that relates

Accepted Answer

A)  the quantity sold and price,which shows the maximum number of units that will be sold at a given price.
B)  the quantity sold and price,which shows the minimum number of units that must be sold to break even.
C)  the quantity sold and price,which shows the minimum number of units that must be sold in order to make a profit.
D)  total production costs to various price points in order to determine how many units must be sold in order to realize a predetermined profit.
E)  primary demand to selective demand.F) A) and D)
G) C) and D)

Question 6

In a snack vending machine,consumers can choose one of up to of 20 choices.These snacks are

Accepted Answer

A)  an ideal example of unitary demand.
B)  likely to have a price elasticity equal to 1.
C)  more likely to be price elastic.
D)  likely to have a price elasticity less than 1.
E)  more likely to be price inelastic.F) C) and D)
G) A) and B)

Question 7

A consumer's near-instantaneous access to competitor's prices for the same offering is referred to as

Accepted Answer

A)  dynamic pricing.
B)  customer value pricing.
C)  price transparency.
D)  value-added pricing.
E)  mobile media pricing.F) A) and C)
G) C) and D)

Question 8

A reference value __________.

Accepted Answer

A)  is relative to the amount of time and energy a consumer puts into the purchase process
B)  is based upon the value assigned to similar items used by the consumer's peers
C)  results from performing a careful break-even analysis
D)  involves comparing the costs and benefits of substitute items
E)  is based upon the differential between customers' "needs" and "wants"F) A) and B)
G) D) and E)

Question 9

The owner of a small restaurant that sells take-out fried chicken and biscuits pays each month $2,500 in rent,$500 in utilities,$750 interest on his loan,insurance premium of $200,and $250 on advertising on local buses.A bucket of take-out chicken is priced at $9.50.Unit variable costs for the bucket of chicken are $5.50.How many small buckets of chicken does the restaurant need to sell to break-even each month?

Accepted Answer

A)  442 buckets
B)  764 buckets
C)  1,050 buckets
D)  3,150 buckets
E)  4,200 bucketsF) A) and C)
G) D) and E)

Question 10

Susan O'Rourke hired an attorney to represent her in a court case involving an auto accident.The attorney charged O'Rourke a $2,000 retainer fee for his services.Terry Thomas needed a haircut-the local stylist charged him $12 for her services.Aaron Mathison mowed his neighbor's lawn;in exchange,the neighbor roto-tilled Mathison's garden.The attorney fees paid by O'Rourke,the $12 charged by the hair stylist,and the exchange of lawn mowing for garden tilling are all examples of

Accepted Answer

A)  premiums.
B)  barter.
C)  the profit motive.
D)  price.
E)  outlays.F) B) and E)
G) B) and C)

Question 11

A BOGO offer is retail slang that means

Accepted Answer

A)  big orders,greater overhead
B)  buy one,get one
C)  build only good offerings
D)  bad once,good overall
E)  buy over grand objectivesF) C) and D)
G) A) and B)

Question 12

The maximum quantity of products consumers will buy at given price is shown by

Accepted Answer

A)  a demand curve.
B)  a price constraint.
C)  a break-even point.
D)  a supply curve.
E)  a marginal revenue curve.F) All of the above
G) A) and E)

Question 13

Marginal cost refers to

Accepted Answer

A)  the sum of the expenses of the firm that are stable and do not change with the quantity of a product that is produced and sold.
B)  the sum of the expenses of the firm that vary directly with the quantity of a product that is produced and sold.
C)  the total expense incurred by a firm in producing and marketing a product,which equals the sum of fixed cost and variable cost.
D)  the average amount of money received for selling one unit of a product or simply the price of that unit.
E)  the change in total cost that results from producing and marketing one additional unit of product.F) D) and E)
G) C) and D)

Question 14

Occasionally,prices may rise later in the product's life cycle.This is often due to

Accepted Answer

A)  new competitors entering the market.
B)  production economies of scale.
C)  a decrease in the price of raw materials.
D)  nostalgia and fad factors.
E)  the type of competitive market shifts from pure monopoly to pure competition.F) A) and C)
G) A) and B)

Question 15

Total cost refers to

Accepted Answer

A)  the sum of the expenses of the firm that are stable and do not change with the quantity of a product that is produced and sold.
B)  the change in expenses that results from producing and marketing one additional unit of a product.
C)  the average amount of money received for selling one unit of a product or simply the price of that unit.
D)  the sum of the expenses of the firm that vary directly with the quantity of a product that is produced and sold.
E)  the total expense incurred by a firm in producing and marketing a product,which equals the sum of fixed cost and variable cost.F) B) and E)
G) B) and D)

Question 16

Market share is the ratio of the __________ to those of the industry,including the firm itself.

Accepted Answer

A)  target return on sales
B)  marginal profit of the firm
C)  firm's sales revenues or unit sales
D)  marketing expenses of the firm
E)  profits of the firmF) C) and D)
G) A) and B)

Question 17

Figure 13-2 above represents the six steps in setting price."F" represents the step at which a firm would

Accepted Answer

A)  set list or quoted price.
B)  select an approximate price level.
C)  scan competitors for prices of similar products or services
D)  make special adjustments to list or quoted price.
E)  establish the price range.F) B) and D)
G) A) and B)

Question 18

If competitive market circumstances are such that there is almost no price competition,no product differentiation,and the only advertising informs prospects that the product is available,then the competitive market in this industry must be __________.

Accepted Answer

A)  a pure monopoly
B)  pure competition
C)  an oligopoly
D)  monopolistic competition
E)  monopolistic oligopolyF) C) and D)
G) None of the above

Question 19

There are a lot of skateboards on the market,but the BMW Streetcarver is the only one with stabilizers and wheel design based on BMW's automobiles.This technology gives the BMW Streetcarver better control at high speeds and around sharp turns than any other brand.The skateboard is priced at $495,which leaves many consumers (especially young males) who might want to buy the Streetcarver unable to afford it.This inability to pay for the high-priced BMW-made skateboard shows the affect of __________ on sales.

Accepted Answer

A)  demand factors
B)  macroeconomic environmental factors
C)  barter factors
D)  supply factors
E)  exchange parametersF) None of the above
G) D) and E)

Question 20

Pricing objectives refer to

Accepted Answer

A)  reconciling the prices charged by an organization to the values set forth in its business mission.
B)  taking specific steps to capitalize on an organization's internal strengths as they apply to price.
C)  specifying the role of price in an organization's marketing and strategic plans.
D)  taking specific steps to compensate for an organization's weaknesses as they apply to price.
E)  subjectively setting intrinsic values to all products and services offered by an organization.F) None of the above
G) B) and D)

Exam 13: Building the Price Foundation

Correct Answer
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Pricing objectives refer to

Correct Answer
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Market share is the ratio of the __________ to those of the industry,including the firm itself.

Correct Answer
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A demand curve refers to a graph that relates

Correct Answer
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Correct Answer
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Total cost refers to

Correct Answer
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A BOGO offer is retail slang that means

Correct Answer
verified

A consumer's near-instantaneous access to competitor's prices for the same offering is referred to as

Correct Answer
verified

A demand curve graph typically appears as

Correct Answer
verified

In a snack vending machine,consumers can choose one of up to of 20 choices.These snacks are

Correct Answer
verified

If competitive market circumstances are such that there is almost no price competition,no product differentiation,and the only advertising informs prospects that the product is available,then the competitive market in this industry must be __________.

Correct Answer
verified

Acme Shoe Company sells heel replacement kits for men's shoes.It has fixed costs of $6 million and unit variable costs of $5 per kit.Suppose a consultant tells Acme that it can sell 750,000 heel repair kits.What price must Acme charge to achieve a profit of $2.5 million?

Correct Answer
verified

Marginal cost refers to

Correct Answer
verified

Occasionally,prices may rise later in the product's life cycle.This is often due to

Correct Answer
verified

__________ occurs when shoppers go to a store,obtain the store price of a product,scan its SKU or bar code with a smartphone camera,and go online to compare prices with those of selected competitors.

Correct Answer
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A reference value __________.

Correct Answer
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The maximum quantity of products consumers will buy at given price is shown by

Correct Answer
verified

Figure 13-2 above represents the six steps in setting price."F" represents the step at which a firm would

Correct Answer
verified

Exam 13: Building the Price Foundation

Correct AnswerverifiedShow Answer

Pricing objectives refer to

Correct AnswerverifiedShow Answer

Market share is the ratio of the __________ to those of the industry,including the firm itself.

Correct AnswerverifiedShow Answer

A demand curve refers to a graph that relates

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Total cost refers to

Correct AnswerverifiedShow Answer

A BOGO offer is retail slang that means

Correct AnswerverifiedShow Answer

A consumer's near-instantaneous access to competitor's prices for the same offering is referred to as

Correct AnswerverifiedShow Answer

A demand curve graph typically appears as

Correct AnswerverifiedShow Answer

In a snack vending machine,consumers can choose one of up to of 20 choices.These snacks are

Correct AnswerverifiedShow Answer

If competitive market circumstances are such that there is almost no price competition,no product differentiation,and the only advertising informs prospects that the product is available,then the competitive market in this industry must be __________.

Correct AnswerverifiedShow Answer

Acme Shoe Company sells heel replacement kits for men's shoes.It has fixed costs of $6 million and unit variable costs of $5 per kit.Suppose a consultant tells Acme that it can sell 750,000 heel repair kits.What price must Acme charge to achieve a profit of $2.5 million?

Correct AnswerverifiedShow Answer

Marginal cost refers to

Correct AnswerverifiedShow Answer

Occasionally,prices may rise later in the product's life cycle.This is often due to

Correct AnswerverifiedShow Answer

__________ occurs when shoppers go to a store,obtain the store price of a product,scan its SKU or bar code with a smartphone camera,and go online to compare prices with those of selected competitors.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A reference value __________.

Correct AnswerverifiedShow Answer

The maximum quantity of products consumers will buy at given price is shown by

Correct AnswerverifiedShow Answer

Figure 13-2 above represents the six steps in setting price."F" represents the step at which a firm would

Correct AnswerverifiedShow Answer

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