Question 1

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 oligopoly.F) A) and B)
G) A) and C) B

Question 2

Pricing objectives involve

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) A) and B)
G) A) and C)

Question 3

What are the six major steps involved in setting prices?

Accepted Answer

Step 1: Identify pricing objectives and constraints.Step 2: Determine price elasticity of demand.Step 3: Perform break-even analysis.Step 4: Select an approximate price level.Step 5: Set list or quoted price.Step 6: Make special adjustments to list or quoted price.

Question 4

Florida Power & Light,an electric power company,is the only source of electricity for consumers in most parts of the Florida panhandle.The company is a(n) ________,despite the fact that it must seek approval from the state utility commission for the rates it can charge.

Accepted Answer

A)  free enterprise firm
B)  oligopoly
C)  monopolistic competitor
D)  competitor in a pure competition
E)  pure monopolyF) All of the above
G) B) and D)

Question 5

Assuming there is no change in a product's price or the quantity demanded,if a business owner wants to increase her advertising expenses by $500 monthly,this would cause total costs to ________ and the break-even quantity to

Accepted Answer

A)  decrease;stay the same.
B)  increase;increase.
C)  decrease;increase.
D)  stay the same;increase.
E)  stay the same;decrease.F) A) and E)
G) A) and D)

Question 6

List four key factors used to estimate demand.

Accepted Answer

Of course,price is one factor.Economists...

Question 7

Which of the following statements regarding pricing constraints is most accurate?

Accepted Answer

A)  Generally,the greater the demand for a product,the higher the price that can be set.
B)  At the corporate level,when setting pricing constraints,a firm must disregard current conditions in the marketplace because they are too temporal for long-term planning.
C)  Pricing constraints must always be set,but they are rarely enforced.
D)  It is possible to create pricing constraints with the greatest range possible in order to anticipate any and all changes in the marketing environment.
E)  Even if a firm is trying to satisfy its obligations to its customers and society in general,it should ignore setting pricing constraints.F) B) and D)
G) B) and C)

Question 8

The unit variable cost (UVC) equals variable cost (VC) divided by

Accepted Answer

A)  quantity (Q) .
B)  fixed costs (F
C)  .
C)  total cost (T
C)  .
D)  total revenue (TR) .
E)  price per unit of the product (P) .F) B) and C)
G) A) and C)

Question 9

Variable 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 change 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 marginal 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 a product.F) All of the above
G) A) and B)

Question 10

A target return profit objective implies that a company chooses to

Accepted Answer

A)  set targets whose performance can be measured quickly.
B)  give up immediate profit in exchange for achieving a higher market share in hopes of penetrating competitive markets.
C)  set a profit goal that is often determined by its board of directors.
D)  reduce investment in any further market or product research.
E)  set prices based on return on sales.F) B) and E)
G) D) and E)

Question 11

A negative aspect of selecting unit volume as a pricing objective is that

Accepted Answer

A)  production often cannot keep up with demand.
B)  there are increased carrying costs with extensive inventories.
C)  if price reductions are used to achieve volume objectives,it can sometimes come at the expense of profits.
D)  it can create competition between divisions within the organization itself,causing conflicts over the allocation of resources.
E)  it always positively correlates with a sales revenue objective.F) A) and E)
G) D) and E)

Question 12

Products such as disposable diapers usually have

Accepted Answer

A)  elastic demand.
B)  null elasticity.
C)  unitary demand.
D)  inelastic supply.
E)  inelastic demand.F) A) and E)
G) C) and D)

Question 13

Many cosmetology schools allow their advanced students to style hair for "real-world" clients for a reduced fee.The students benefit from the experience,the clients get a less expensive haircut,and the school is able to provide students with additional training without it costing anything;in fact,they even profit from it.This is an example of

Accepted Answer

A)  value pricing.
B)  societal pricing.
C)  revenue sharing.
D)  barter.
E)  cost-assist pricing.F) C) and E)
G) B) and C)

Question 14

Which of the following statements is most accurate?

Accepted Answer

A)  For some products,price influences the perception of overall quality,and ultimately value,to consumers.
B)  A consumer's view of a product's value depends almost entirely on external assessments of quality.
C)  A consumer's view of value is a function of his or her education and income.
D)  Price plays only a small part in a consumer's perceived value of a product or service.
E)  Price plays a large role in assessing value but a very minor role in assessing quality.F) A) and C)
G) A) and D)

Question 15

Tara is enrolled for spring semester at college.The tuition is $6,000,but she has a scholarship for $1,000 as well as a work-study grant of $1,500.The health fees and student activity fees are $150 for the semester.What is the final price that Tara will pay for the spring semester?

Accepted Answer

A)  $2,500
B)  $2,650
C)  $3,150
D)  $3,650
E)  $6,150F) B) and E)
G) B) and D) D

Question 16

Figure 13-7
 
-In the break-even chart in Figure 13-7 above,point A identifies the firm's ________ point.

Accepted Answer

A)  loss
B)  price
C)  margin
D)  profit
E)  break-evenF) A) and E)
G) C) and D)

Question 17

Washburn Guitars markets its guitars to four distinct market segments.The firm's mass customization instruments are targeted at

Accepted Answer

A)  first-time buyers.
B)  professional musicians.
C)  stars and famous musicians.
D)  large institutional buyers such as band programs.
E)  intermediate-skill players who may become professional musicians.F) A) and D)
G) B) and D)

Question 18

________ = (Unit price × Quantity sold) − Total cost.

Accepted Answer

A)  Total revenue
B)  Variable cost
C)  Net present value
D)  Profit
E)  Break-even pointF) B) and D)
G) A) and B)

Question 19

Total revenue refers to

Accepted Answer

A)  the profit made from selling a product or service.
B)  the net gain in sales if the unit price is lowered.
C)  the least number of units sold needed to cover product,distribution,and promotional costs.
D)  the amount at which marginal costs exceed fixed costs.
E)  the total money received from the sale of a product.F) B) and D)
G) A) and E)

Question 20

Which of the following would be an example of an objective in Step 1 of the price-setting process?

Accepted Answer

A)  We need to set an initial price of $259 per unit.
B)  We need to obtain a 10 percent market share.
C)  We need to find the least expensive distributor.
D)  We need to make allowances for large quantity orders.
E)  We need to increase the price during the holiday shopping season.F) C) and D)
G) A) and B)

Exam 13: Building the Price Foundation

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
B

Pricing objectives involve

Correct Answer
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What are the six major steps involved in setting prices?

Correct Answer
verified
Step 1: Identify pricing objectives and constraints.Step 2: Determine price elasticity of demand.Step 3: Perform break-even analysis.Step 4: Select an approximate price level.Step 5: Set list or quoted price.Step 6: Make special adjustments to list or quoted price.

Florida Power & Light,an electric power company,is the only source of electricity for consumers in most parts of the Florida panhandle.The company is a(n) ________,despite the fact that it must seek approval from the state utility commission for the rates it can charge.

Correct Answer
verified

Assuming there is no change in a product's price or the quantity demanded,if a business owner wants to increase her advertising expenses by $500 monthly,this would cause total costs to ________ and the break-even quantity to

Correct Answer
verified

List four key factors used to estimate demand.

Correct Answer
verified
Of course,price is one factor.Economists...
View Answer

Which of the following statements regarding pricing constraints is most accurate?

Correct Answer
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The unit variable cost (UVC) equals variable cost (VC) divided by

Correct Answer
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Variable cost refers to

Correct Answer
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A target return profit objective implies that a company chooses to

Correct Answer
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A negative aspect of selecting unit volume as a pricing objective is that

Correct Answer
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Products such as disposable diapers usually have

Correct Answer
verified

Correct Answer
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Which of the following statements is most accurate?

Correct Answer
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Tara is enrolled for spring semester at college.The tuition is $6,000,but she has a scholarship for $1,000 as well as a work-study grant of $1,500.The health fees and student activity fees are $150 for the semester.What is the final price that Tara will pay for the spring semester?

Correct Answer
verified
D

Figure 13-7 -In the break-even chart in Figure 13-7 above,point A identifies the firm's ________ point.

Correct Answer
verified

Washburn Guitars markets its guitars to four distinct market segments.The firm's mass customization instruments are targeted at

Correct Answer
verified

________ = (Unit price × Quantity sold) − Total cost.

Correct Answer
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Total revenue refers to

Correct Answer
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Which of the following would be an example of an objective in Step 1 of the price-setting process?

Correct Answer
verified

Exam 13: Building the Price Foundation

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 AnswerverifiedB

Pricing objectives involve

Correct AnswerverifiedShow Answer

What are the six major steps involved in setting prices?

Correct AnswerverifiedStep 1: Identify pricing objectives and constraints.Step 2: Determine price elasticity of demand.Step 3: Perform break-even analysis.Step 4: Select an approximate price level.Step 5: Set list or quoted price.Step 6: Make special adjustments to list or quoted price.

Florida Power & Light,an electric power company,is the only source of electricity for consumers in most parts of the Florida panhandle.The company is a(n) ________,despite the fact that it must seek approval from the state utility commission for the rates it can charge.

Correct AnswerverifiedShow Answer

Assuming there is no change in a product's price or the quantity demanded,if a business owner wants to increase her advertising expenses by $500 monthly,this would cause total costs to ________ and the break-even quantity to

Correct AnswerverifiedShow Answer

List four key factors used to estimate demand.

Correct AnswerverifiedOf course,price is one factor.Economists...View AnswerShow Answer

Which of the following statements regarding pricing constraints is most accurate?

Correct AnswerverifiedShow Answer

The unit variable cost (UVC) equals variable cost (VC) divided by

Correct AnswerverifiedShow Answer

Variable cost refers to

Correct AnswerverifiedShow Answer

A target return profit objective implies that a company chooses to

Correct AnswerverifiedShow Answer

A negative aspect of selecting unit volume as a pricing objective is that

Correct AnswerverifiedShow Answer

Products such as disposable diapers usually have

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following statements is most accurate?

Correct AnswerverifiedShow Answer

Tara is enrolled for spring semester at college.The tuition is $6,000,but she has a scholarship for $1,000 as well as a work-study grant of $1,500.The health fees and student activity fees are $150 for the semester.What is the final price that Tara will pay for the spring semester?

Correct AnswerverifiedD

Figure 13-7 -In the break-even chart in Figure 13-7 above,point A identifies the firm's ________ point.

Correct AnswerverifiedShow Answer

Washburn Guitars markets its guitars to four distinct market segments.The firm's mass customization instruments are targeted at

Correct AnswerverifiedShow Answer

________ = (Unit price × Quantity sold) − Total cost.

Correct AnswerverifiedShow Answer

Total revenue refers to

Correct AnswerverifiedShow Answer

Which of the following would be an example of an objective in Step 1 of the price-setting process?

Correct AnswerverifiedShow Answer

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B

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Step 1: Identify pricing objectives and constraints.Step 2: Determine price elasticity of demand.Step 3: Perform break-even analysis.Step 4: Select an approximate price level.Step 5: Set list or quoted price.Step 6: Make special adjustments to list or quoted price.

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Of course,price is one factor.Economists...
View Answer

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D

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