Question 1

Figure 14-7
-Figure 14-7 above shows the three major types of special adjustments to the list or quoted price. Box C represents

Accepted Answer

A)   demand-oriented price adjustments.
B)   allowances.
C)   customary pricing adjustments.
D)   discounts.
E)   geographical adjustments.F) A) and B)
G) C) and E)

Question 2

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) B) and D)
G) D) and E)

Question 3

What are the conditions favoring the use of penetration pricing?

Accepted Answer

The conditions favoring penetration pric...

Question 4

A manufacturer does marketing research and estimates that consumers will accept a manufacturer's suggested retail price of $50 for a jacket. The manufacturer expects to offer trade discount terms of 40/10/5 to retailers, wholesalers, and agents in its marketing channel. What price will the manufacturer receive for the jacket?

Accepted Answer

A)   $47.50
B)   $45.00
C)   $30.00
D)   $27.50
E)   $25.65F) None of the above
G) All of the above

Question 5

When is skimming pricing an effective strategy?

Accepted Answer

Skimming pricing is an effective strateg...

Question 6

Architectural firms that specialize in designing and constructing one-of-a-kind custom buildings such as the Rock and Roll 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 C)
G) C) and D)

Question 7

Cumulative quantity discounts are

Accepted Answer

A)   reductions in unit costs for a larger order.
B)   cumulative cash payments or extra amounts of "free goods" awarded sellers in the channel of distribution for undertaking certain advertising or selling activities to promote a product.
C)   discounts offered to sellers for first-time purchases of a new product as incentives for providing shelf space.
D)   an accumulation of discounts for every additional rebuy in which the discount becomes incrementally higher.
E)   discounts that apply to the accumulation of purchases of a product over a given time period, typically a year.F) A) and B)
G) None of the above

Question 8

The Consumer Goods Pricing Act, the Sherman Act, the Federal Trade Commission Act, and the Robinson-Patman Act all address different aspects of deceptive pricing. Select one example for each act and explain which aspects of the practice would be considered illegal.

Accepted Answer

The Consumer Goods Pricing Act considers...

Question 9

Which industry is most likely to adopt an experience-curve pricing approach?

Accepted Answer

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

Question 10

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

Accepted Answer

A)   EDLP encourages manufacturer allowances.
B)   Supermarkets have hailed EDLP as the most effective form of value pricing.
C)   Some argue that EDLP without price specials is boring for many grocery shoppers.
D)   EDLP allows supermarkets to use deeply discounted price specials.
E)   EDLP can increase average retail prices by as much as 10 percent.F) C) and E)
G) None of the above

Question 11

Experience-curve pricing is considered to be a ________ approach to pricing.

Accepted Answer

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

Question 12

A company placing an order from the Lab Safety Supply catalog is instructed to add $25 to the total cost of the order to pay for shipping regardless of the buyer's location. Which method of shipping does this catalog supplier use?

Accepted Answer

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

Question 13

Demand-oriented approaches weigh factors that underlie expected ________ more heavily than such factors as cost, profit, and competition when selecting a price level.

Accepted Answer

A)   total revenue
B)   stakeholder concerns
C)   discounting practices
D)   product substitutes
E)   customer tastesF) A) and D)
G) All of the above

Question 14

A conspiracy among firms to set prices for a product is referred to as

Accepted Answer

A)   price discrimination.
B)   price fixing.
C)   predatory pricing.
D)   tying arrangements.
E)   exclusive dealing.F) A) and B)
G) A) and C)

Question 15

To reward wholesalers and retailers for the risk they accept in assuming increased inventory carrying costs, manufacturers offer

Accepted Answer

A)   noncumulative discounts.
B)   cumulative discounts.
C)   trade discounts.
D)   seasonal discounts.
E)   functional discounts.F) C) and E)
G) A) and E)

Question 16

Another name for a fixed-price policy is

Accepted Answer

A)   customary pricing.
B)   a one-price policy.
C)   dynamic pricing.
D)   standard markup pricing.
E)   uniform pricing.F) B) and D)
G) C) and E)

Question 17

While ________ often changes price based upon color or style, ________ often changes prices based on time, day, week, or season.

Accepted Answer

A)   prestige pricing; skimming pricing
B)   yield management pricing; bundle pricing
C)   price lining; yield management pricing
D)   target pricing; target return on investment pricing
E)   bundle pricing; standard markup pricingF) A) and D)
G) B) and E)

Question 18

Which of the following statements regarding price lining is most accurate?

Accepted Answer

A)   In order for price lining to be effective, there should be at least five specified price points.
B)   Price lining assumes that demand is inelastic at each price point but elastic between price points.
C)   Price lining assumes that demand is elastic at each price point but inelastic between price points.
D)   Price lining is the preferred pricing strategy for governmental contracts.
E)   Price lining is the same as above-, at-, or below-market pricing.F) A) and B)
G) C) and D)

Question 19

Japanese, Korean, and U.S. firms in the electronics industry often adopt which cost-oriented pricing approach, one that complements the demand-oriented pricing strategy of skimming followed by penetration pricing?

Accepted Answer

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

Question 20

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) A) and B)
G) None of the above

Exam 14: Arriving at the Final Price

The Consumer Goods Pricing Act, the Sherman Act, the Federal Trade Commission Act, and the Robinson-Patman Act all address different aspects of deceptive pricing. Select one example for each act and explain which aspects of the practice would be considered illegal.

Correct Answer
verified
The Consumer Goods Pricing Act considers...
View Answer

Another name for a fixed-price policy is

Correct Answer
verified

Japanese, Korean, and U.S. firms in the electronics industry often adopt which cost-oriented pricing approach, one that complements the demand-oriented pricing strategy of skimming followed by penetration pricing?

Correct Answer
verified

What are the conditions favoring the use of penetration pricing?

Correct Answer
verified
The conditions favoring penetration pric...
View Answer

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

Correct Answer
verified

Which of the following statements regarding price lining is most accurate?

Correct Answer
verified

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

Correct Answer
verified

Correct Answer
verified

A company placing an order from the Lab Safety Supply catalog is instructed to add $25 to the total cost of the order to pay for shipping regardless of the buyer's location. Which method of shipping does this catalog supplier use?

Correct Answer
verified

To reward wholesalers and retailers for the risk they accept in assuming increased inventory carrying costs, manufacturers offer

Correct Answer
verified

Which industry is most likely to adopt an experience-curve pricing approach?

Correct Answer
verified

When is skimming pricing an effective strategy?

Correct Answer
verified
Skimming pricing is an effective strateg...
View Answer

Experience-curve pricing is considered to be a ________ approach to pricing.

Correct Answer
verified

Figure 14-7 -Figure 14-7 above shows the three major types of special adjustments to the list or quoted price. Box C represents

Correct Answer
verified

While often changes price based upon color or style, often changes prices based on time, day, week, or season.

Correct Answer
verified

Cumulative quantity discounts are

Correct Answer
verified

Odd-even pricing refers to

Correct Answer
verified

A conspiracy among firms to set prices for a product is referred to as

Correct Answer
verified

Demand-oriented approaches weigh factors that underlie expected ________ more heavily than such factors as cost, profit, and competition when selecting a price level.

Correct Answer
verified

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

Correct Answer
verified

Exam 14: Arriving at the Final Price

The Consumer Goods Pricing Act, the Sherman Act, the Federal Trade Commission Act, and the Robinson-Patman Act all address different aspects of deceptive pricing. Select one example for each act and explain which aspects of the practice would be considered illegal.

Correct AnswerverifiedThe Consumer Goods Pricing Act considers...View AnswerShow Answer

Another name for a fixed-price policy is

Correct AnswerverifiedShow Answer

Japanese, Korean, and U.S. firms in the electronics industry often adopt which cost-oriented pricing approach, one that complements the demand-oriented pricing strategy of skimming followed by penetration pricing?

Correct AnswerverifiedShow Answer

What are the conditions favoring the use of penetration pricing?

Correct AnswerverifiedThe conditions favoring penetration pric...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following statements regarding price lining is most accurate?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A company placing an order from the Lab Safety Supply catalog is instructed to add $25 to the total cost of the order to pay for shipping regardless of the buyer's location. Which method of shipping does this catalog supplier use?

Correct AnswerverifiedShow Answer

To reward wholesalers and retailers for the risk they accept in assuming increased inventory carrying costs, manufacturers offer

Correct AnswerverifiedShow Answer

Which industry is most likely to adopt an experience-curve pricing approach?

Correct AnswerverifiedShow Answer

When is skimming pricing an effective strategy?

Correct AnswerverifiedSkimming pricing is an effective strateg...View AnswerShow Answer

Experience-curve pricing is considered to be a ________ approach to pricing.

Correct AnswerverifiedShow Answer

Figure 14-7 -Figure 14-7 above shows the three major types of special adjustments to the list or quoted price. Box C represents

Correct AnswerverifiedShow Answer

While ________ often changes price based upon color or style, ________ often changes prices based on time, day, week, or season.

Correct AnswerverifiedShow Answer

Cumulative quantity discounts are

Correct AnswerverifiedShow Answer

Odd-even pricing refers to

Correct AnswerverifiedShow Answer

A conspiracy among firms to set prices for a product is referred to as

Correct AnswerverifiedShow Answer

Demand-oriented approaches weigh factors that underlie expected ________ more heavily than such factors as cost, profit, and competition when selecting a price level.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Correct Answer
verified
The Consumer Goods Pricing Act considers...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The conditions favoring penetration pric...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Skimming pricing is an effective strateg...
View Answer

Correct Answer
verified

Correct Answer
verified

While often changes price based upon color or style, often changes prices based on time, day, week, or season.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified