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Which of the following correctly identifies the three major pricing strategies used by marketers? |
Customer value-based pricing, cost-based pricing, and competition-based pricing |
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A(n) __________ shows the number of units the market will buy in a given time period at different prices. |
demand curve |
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How is price determined using cost-plus pricing? |
The price is set by adding a standard mark-up to the cost of the product. |
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Internal factors that affect pricing include __________. |
the company’s overall marketing strategy, objectives, and marketing mix |
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Which of the following statements about price is correct? |
Customers have put increasing pricing pressures on many companies. |
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Retailers such as Macy’s and JC Penney charge higher prices on an everyday basis, but run frequent promotions to lower prices temporarily on selected items. This is an example of __________. |
high-low pricing |
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Which of the following is true regarding the price-demand relationship? |
If demand is elastic, sellers will consider lowering their price. |
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Two external factors which must be considered in pricing decisions are __________. |
demand and the nature of the market |
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New, premium movie theaters offer features such as online reserved seating, high-backed leather executive chairs with armrests and footrests, the latest in digital sound and super-wide screens, and other amenities for which they charge a higher price. This is an example of which type of pricing? |
Value-added pricing |
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Which of the following is a cost-based pricing approach? |
Break-even pricing |
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Which of the following statements is true regarding costs? |
Average cost tends to decrease with accumulated production experience. |
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The amount of money charged for a product is its __________. |
price |
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The strategy of __________ means that the firm attempts to offer the right combination of quality and good service at a fair price. |
good-value pricing |
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In which type of market does no buyer or seller have much impact on setting the going market price? |
Pure competition |
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Which of the following statements is correct regarding different types of markets? |
Under oligopolistic competition each seller is alert and responsive to competitors’ pricing strategies and marketing moves. |
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Which type of market consists of many buyers and sellers trading over a range of prices rather than a single market price? |
Monopolistic competition |
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Which factor sets the ceiling on setting a product’s price? |
Customer’s value perceptions |
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Luxury automobile manufacturers typically add quality, services, and other features to differentiate their offers and thus support their higher price. This is an example of __________. |
value-added pricing |
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Which of the following statements regarding customer value-based pricing is correct? |
In using this strategy, companies often find it hard to measure the value customers attach to their product. |
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Price is the only part of the marketing mix that __________. |
produces revenue |
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What is the first thing marketers must do when using value-based pricing? |
Assess customer needs and value perceptions. |
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Beyond the nature of the market, demand, and the economy, what other factors in a firm’s external environment must a company consider when setting prices? |
Resellers, the government, and social concerns |
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What is target costing? |
Setting a price and then setting costs that will ensure that the price is met |
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Which factor sets the floor on setting a product’s price? |
Product costs |
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On a break-even chart, the break-even volume is located __________. |
at the intersection of total revenue and total costs |
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