general business data bank

Question # 00003607 Posted By: vikas Updated on: 11/16/2013 12:22 PM Due on: 11/30/2013
Subject Marketing Topic Marketing Tutorials:
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1) A company sets not a single price, but rather a ________ that covers different items in its line that change over time as products move through their life cycles.

A) pricing by-product

B) pricing structure

C) pricing loop

D) pricing cycle

E) pricing bundle

2) Companies facing the challenge of setting prices for the first time can choose between two broad strategies: market-penetration pricing and ________.

A) market-level pricing

B) market-competitive pricing

C) market-skimming pricing

D) market-price lining

E) market-price filling


3) Of the following, which statement would NOT support a market-skimming policy for a new product?

A) The product's quality and image support its higher price.

B) Enough buyers want the products at that price.

C) Competitors are not able to undercut the high price.

D) Competitors can enter the market easily.

E) C and D

4) HiPoint Telephone Company uses two-part pricing for its long-distance call charges. Because this is a service, the price is broken into a fixed rate plus a ________.

A) fixed rate usage

B) variable usage rate

C) standard usage rate

D) market usage rate

E) none of the above

5) Companies involved in deciding which items to include in the base price and which to offer as options are engaged in ________ pricing.

A) product bundle

B) optional-product

C) captive-product

D) by-product

E) skimming

6) Keeping in mind that a seller must sell by-products at a price that covers more than the cost of storing and delivering them, which of the following will by-product pricing permit a seller to do?

A) increase the main product's price

B) make extra profit

C) reduce the main product's price

D) none of the above

E) B and C

7) With product bundle pricing, sellers can combine several products and offer the bundle ________.

A) as a working unit

B) at a reduced price

C) as a complete self-service package

D) as a reward to loyal customers

E) as segmented pricing

8) What is a major advantage of product bundle pricing?

A) It can promote the sales of products consumers might not otherwise buy.

B) It offers consumers more value for the money.

C) It combines the benefits of the other pricing strategies.

D) It provides a more complete product experience for consumers.

E) All of the above.

9) Which of the following is NOT a price adjustment strategy?

A) segmented pricing

B) promotional pricing

C) free samples

D) geographical pricing

E) seasonal pricing

10) Service Industries, Inc., plans to offer a price-adjustment strategy in the near future. They could consider each of the following EXCEPT ________.

A) discount and allowance pricing

B) segmented pricing

C) physiological pricing

D) promotional pricing

E) location pricing

11) Consumer use price less to judge the quality of a product when they ________.

A) lack information

B) lack skills to use the product

C) have experience with the product

D) are shopping for a specialty item

E) cannot physically examine the product

12) Michael and John both own leather jackets and are currently shopping for two new ones. They both have prices in mind and refer to them when shopping. These prices are termed ________.

A) psychological prices

B) reference prices

C) comparison prices

D) price points

E) skimmed prices

13) Which of the following refers to the prices that a buyer carries in his or her mind and refers to when looking at a given product?

A) target prices

B) reference prices

C) promotional prices

D) geographical prices

E) dynamic prices

14) Price escalation in international markets may result from four of these five marketing conditions. Which one will have the LEAST effect?

A) the additional cost of physical distribution

B) exchange-rate fluctuations

C) market stability

D) higher costs of selling

E) language barriers

15) There are many reasons why a firm might consider cutting its price. All of the following are among them EXCEPT ________.

A) excess capacity

B) falling demand in the face of strong price competition

C) a drive to dominate the market through lower costs

D) monopolistic competition

E) a drive to gain market share and cut costs through volume

16) Which of the following is a reason for a company to raise its prices?

A) to address the issue of overdemand for a product

B) to win a larger share of the market

C) to use excess capacity

D) to boost sales volume

E) to balance out decreasing costs

17) Which of the following is a major factor that influence price increases?

A) cost inflation

B) surplus of raw materials

C) government intervention

D) foreign competition

E) B and C

18) Competitors are most likely to react to a price change when ________.

A) the number of firms involved is small

B) the purchase is uniform

C) the buyers are not well informed

D) A and B

E) all of the above

19) Price discrimination is legal under which of the following conditions?

A) when a manufacturer and reseller have agreed upon a specified retail price for a product

B) when a manufacturer sells to retailers in different markets

C) when a seller can prove its costs are different when selling to different retailers

D) when a seller advertises prices that are not actually available to consumers

E) when a seller has not communicated with competitors before announcing prices

20) Price discrimination may be used to match competition as long as the strategy is temporary, localized, and ________.

A) defensive

B) offensive

C) published

D) private

E) used in all channels

21) When a manufacturer seeks a market for by-products and accepts a price that covers more than the cost of storing and delivering those by-products, the manufacturer is able to reduce the main product's price to make it more competitive.

22) When using product bundle pricing, sellers combine several of their products and offer the bundle at an increased price for increased profit.

23) Most companies adjust their basic prices to account for various customer differences and changing situations.

24) A seasonal discount is a price reduction to buyers who buy merchandise or services while they are in season.

25) Manufacturers may offer functional discounts within trade channels for channel members who store inventory.

26) The basic difference between customer-segment pricing and product-form pricing is that the latter offers alternative versions of the product that are priced differently but not according to differences in their costs.

27) Segmented pricing is known by other names; two of the most common are revenue management and yield management.

28) A company considering a price change should be more concerned about consumers' reactions than competitors' reactions.

29) Your company may respond to a competitor's price reduction by launching a low-price fighting brand. This is likely necessary if the particular market segment being lost is price sensitive and will not respond to arguments of higher quality.

30) State and federal governments accept some reasons for price-fixing when it does not limit competition.

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