question

Historically has been considered as the major determinant of a buyer choice by economists.

answer

price

question

Which of the following is not one of the external factors affecting price decisions?

answer

costs

question

If a firm is pursuing a product quality leadership pricing objective, it would charge a high price to cover the high product quality and high cost of R&D.

answer

true

question

If demand is elastic rather than inelastic and the firm is interested in increasing total revenue, the firm should

answer

lower the price

question

In non?regulated monopolies, companies are:

answer

sometimes constrained in making pricing decisions due to fear of government regulation

question

Demand sets a(n):

answer

ceiling to the price that a company can charge for its product.

question

In perceived value pricing,

answer

nonprice marketing mix variables are used to build up demand.

question

Which of the following is not one of the reasons offered why the cost plus approach to pricing is still popular?

answer

The approach considers both demand and competition.

question

When a company faces intense competition or changing consumer wants and at the same time suffers from over capacity, it is most likely to adopt a in its pricing strategy.

answer

survival objective

question

Demand curves:

answer

show the relationship between price and quantity demanded. are typically downward sloping.

question

Steven Goss found that when he raised his price, the quantity purchased by consumers dropped slightly, but overall he made more money. Goss is facing a(n):

answer

inelastic demand curve

question

Which pricing method is being used when a firm competes for business and bases its price on expectations of how competitors will price rather than on a relation to its own costs of demand?

answer

sealed bid pricing

question

In a normal demand curve, changes in demand and price are:

answer

inversely related

question

Realistic Gel Corporation competes in a market characterized by many buyers and sellers who trade over a range of prices rather than a single price. (The range of prices occurs because sellers can differentiate their offer to buyers.) Realistic is engaged incompetition.

answer

monopolistic

question

Which of the following statements about the price elasticity of demand is true?

answer

Buyers are less price sensitive when the product they are buying is unique. Buyers are less sensitive when the product is high in quality, prestige or exclusiveness. Buyers are less price sensitive when substitute products are hard to find or when they cannot easily compare the quality of substitutes.

question

Which of the following is not one of the conditions favorable to a market penetration pricing policy?

answer

Production costs per unit increase as the level of production increases.

question

A market skimming pricing policy:

answer

starts with a high price which is gradually lowered

question

The additional charge for bucket seats over a bench seat in an automobile is an example of:

answer

optional product pricing.

question

By?product pricing may

answer

Either increase the final price of the main product.Ordecrease the final price of the main product.

question

Robin Sloan received an invoice with the following terms of payment: 10/20, N/30. These terms mean that:

answer

payment is due within 30 days but the buyer can deduct 10 percent of anything paid within 20 days

question

When McCormiks Restaurant store offers a 15 percent discount on all purchases to individuals 55 years of age or older, McCormiks is practicing:

answer

discriminatory pricing

question

Kandy Industries sells its products FOB origin. In this case:

answer

each customer pays for its own freight costs. and the seller becomes a high?cost firm to distant customers

question

Under which of the following does the seller agree to pay all of the freight cost to a customer

answer

freight absorption pricing

question

The Lapham Company will sell up to 500 units of its product for $15 each, but charges only $13 per unit if the buyer purchases more than 500 units at one time. Lapham is offering:

answer

quantity discounts

question

Which of the following is not necessary for price discrimination to work: a The cost of segmenting the market should not exceed the extra revenue obtained from price discrimination

answer

The various segments of the market must show identical intensities of demand

question

Under which circumstances should a firm attempt to initiate a price cut?

answer

excess capacity

question

A price increase may carry which of the following meanings to the buyer?

answer

The item is an unusually good value. The item is "hot" (in demand) and may be unobtainable unless purchased soon .The seller is charging what the traffic will bear.

question

Cash discounts are offered to buyers in an effort to

answer

improve the sellers liquidity. b reduce bad debts. c reduce credit collection costs

question

L.C.'s Wholesale Club charges its customers low prices to attract high sales volume. The high volume results in lower costs which in turn allows L.C. to keep prices low. L.C. appears to be practicing pricing.

answer

market penetration

question

The NS Wagon Company earns $500,000 in profits on sales of $6,000,000. It has total assets of $3,000,000 and net worth of $1,750,000. Calculate its net profit margin (i.e., return on sales or net profit percentage)

answer

8.3% (net profit ÷ sales = net profit margin (aka return on sales) $500,000 / $6,000,000 = 8.3%)

question

A boy purchases a wagon for $22.80 and sells it for $38. What is his markup on his selling price?

answer

40% (Answer: Mp = P-V/P Where Mp = markup on Price, V = variable coat. P = Price Mp = (38-22.80)/38 = 40%)

question

You have a plan to increase your advertising by $300,000. Your current selling price is $80 per unit and your variable cost of making each unit is $50. Your current markup on selling price is 37.5%. How many units must you sell to breakeven on the additional $300,000.

answer

10,000 units (answer : Breakeven volume = fixed cost/(price-variable cost) = 300,000/(80-50) = 10,000 units)

question

A firm makes shoes for a cost of $20 pair and sells them for a price that earns them a 60% markup on price. What price does the firm sell the shoes for?

answer

$50 (Answer: P-V = MpP P-20 = .6P P- .6P = 20 0.4P = 20 P = 20/0.4 = 50)

question

The Better Shoes company is selling 300,000 shoes at $100 a pair. It estimates that the price elasticity (aka, customer price sensitivity) is -1.7 and is planning on lowering its price in the domestic to $96. It has reason to believe the price change will increase its sales volume to 320,400 shoes.

answer

true (Elasticity predicts a 1% change in price changes volume y 1.7% Percentage increase in quantity = 4 x 1.7 = 6.8% Quantity increases to = 1.068 (300,000) = 320,400 pairs of shoes)

question

The Gulf Wagon manufacturing company traditionally charges a selling price of P = $22 per wagon. It has the following costs: A variable cost = V = $12 per wagon A fixed or period cost = F = $400,000 What quantity of wagons must it sell to cover its total costs (aka the breakeven quantity (BEQ))?

answer

40,000 wagons (BEQ = F/(P-V) BEQ = $400,000 / ($22 - $12) = $400,000 /$10 = 40,000)

question

The Gulf Wagon manufacturing company desires a 25% return on sales (also known as the net profit margin) and anticipates a sales volume of Q = 50,000 wagons. It has the following costs: 2 The variable cost = V = $12 per wagon The fixed or period cost = F = $400,000 What selling price must it charge to cover its total costs and produce the desired return on sales (RoS)?

answer

26.67 per wagon (Average cost per wagon (aka breakeven price) = V + F/Q Average cost per wagon (aka breakeven price) = 12 + 400,000/50,000 Average cost per wagon (aka breakeven price) =12 + 8 = $20 Selling Price = average cost ÷ (1-RoS) Selling Price = $20 / (1 - 0.25) = $26.67 )

question

The Faster Shoe Company earns $500,000 in profits on sales of $6,000,000. It has total assets of $3,000,000 and the shareholders' net worth of $1,750,000. Calculate its return on investment (ROI).

answer

16.67% (net profit ÷ assets = return on investment (ROI) $500,000 / $3,000,000 = 16.67% )

question

branding is apart of:

answer

Positioning

question

Branding: Some customers see

answer

Expensive, a social waste, Packaging, prefer to Inspect Own Purchase (Fruit, Fish, Meat)

question

Branding: Most customers see

answer

Guides To Consistent Quality, Fast Search

question

Branding: example of bad packaging

answer

Sign Of Bad Product 1957 India example of 25% of all packaged goods adulterated up to 50% by weight

question

Branding: example of a good fast search

answer

Supermarket Have 7000 - 10,000 items - How To Shop without Names?)

question

Branding: From a Seller's point of view

answer

Get more money for a well known Brand (13% higher price),Encourages Repeat Buying ,Allows For Segmentation , Build Corporate Image (Brand Equity) , Stock Control (pre UPC) Reduce Price Comparison ,Presell (Allows for Pull Strategy), Use Shelf Display Promotion

question

Branding: when to brand

answer

Extra Demand Must Cover Costs ,Have Good Quality Control ,Should Stay With Product, Wide and Consistent Availability (Location)

question

Branding: When not to brand

answer

Assume The Responsibility and Cost of Advertising and Promotion, Does Too Well

question

branding: example of "Does to well"

answer

Coke, SkiDoo, Kleenex, Aspirin Nature of Product RCoal, Pins, Nails, Cotton,

question

Branding: accept possible backlash

answer

12% of names help , 36% of names reduce purchase , 52% of names are nonentities

question

branding:Example of individual brand names

answer

General Mills Procter & Gamble

question

branding:example of blanket family name brands

answer

Heinz, General Electric, Philips

question

branding:example of separate family names

answer

Sears: Kenmore, Craftsman

question

branding:example of Family name with individual brand name

answer

Kellogg's corn flakes

question

branding:example of global brand names (same in all countries)

answer

Coke, Exxon, Kodak,

question

branding:Extension Branding

answer

Line Extension (Lite, Caffeine-Free, Mint Flavored) Brand Extension (Liquid Spic and Span, Lifesaver Holes) Multibrand Strategy (Electrolux Owns Frigidare, Kelvinator,Westinghouse, RP&G) owns Nine different detergents

question

branding: battle of the brands

answer

Manufacture's brand versus Wholesaler's brand versus Retailer's brand

question

Branding: national versus middleman/house

answer

Manufacture's brand versus Retailer's brand

question

Branding: retailer's advantage using National

answer

Pre-sold, risk is borne by manufacture, less inventory

question

branding: retailer's advantage using Own House

answer

price flexibility, switch suppliers, shelf position

question

Branding: disadvantages using National

answer

lower margin, may withdraw, loyalty not to store

question

branding: disadvantages using Own House

answer

Do own promotion, carry the risk, higher inventory, find suppliers(consistent quality)

question

Branding: the fifth P(packaging and labeling)

answer

Self-Service Consumer Opportunity for story, Part of Store Security ,Offers real Benefits

question

a product is anything that has value to a consumer and can be offered through a voluntary exchange

answer

true

question

a company's product line consists of its various product mixes

answer

false

question

harold is a loyal coca-cola customer. Loyal customers like harold are typically less price sensitive than other consumers, benefitting businesses like coca cola

answer

true

question

a customized carved wood cedar wood sign for your house is an example of a convenience product

answer

false

question

Kellogg's sells many different breakfast cereals, including korn flakes, rice krispies, ect. This is an indication of the breadth of the kellogg's product mix

answer

false

question

the complete set of all products offered by a firm is called it's:

answer

product mix

question

A __ is a group of associated items that consumers tend to use together or think of as a part of a group of similar products

answer

product line

question

for a major university, undergraduate studies, graduate studies , and professional programs would be ____ within the university 's product mix

answer

product lines

question

A(n)_____ is a name, symbol, design , or a term that identifies a seller's good or service as distinct from those of other sellers

answer

brand

question

a firm's product mix breadth is its:

answer

number of product lines

question

___is the number of items within a product line

answer

product line depth

question

the decision to delete a product is never taken lightly because, generally, manufacturers have:

answer

made substantial investments in brand development and manufacturing

question

the primary purpose of a brand is to :

answer

distinctly identify one seller's goods or services from competitor's offerings

question

marketers spend billions of dollars annually attempting to build effective brands.The basic benefit of a brand is that it :

answer

provides a way for a firm to differentiate its product offerings from those of its competitors.

question

for a brand to be effective, it needs to be :

answer

easy for consumers to recognize and remember

question

when consumers associate a brand with a certain level of quality and familiar attributes allowing consumers to make quick decisions , the brand:

answer

facilitates purchasing

question

brands are assets that can be legally protected through:

answer

copyrights and trademarks

question

___ is the set of assets and liabilities linked to a brand that add to or subtract from the value provided by the product or service

answer

brand equity

question

a firm's product mix breadth is its:

answer

number of product lines

question

___is the number of items within a product line

answer

product line depth

question

if many consumers in marketplace are familiar with a brand and what it stands for and have an opinion about the brand the brand has considerable:

answer

awareness

question

sometimes brand names become synonymous with a product itself. if that happens, the firm:

answer

could lose its trademark

question

kleenex tissues, clorox bleach, and scotch tape brands have:

answer

become synonymous with the product itself

question

in a competitive market, perceived value is determined by consumers mostly:

answer

in relationship to the value of the competitor's offerings.

question

nora is deciding whether to purchase brand names sneakers or a store brand. She has purchased other shoes with the same brand name in the past but was only marginally satisfied. in this situation, nora is likely to purchase the store brand sneakers because they offer:

answer

greater perceived value

question

recent apple computer company ads showed a young, casually dressed, friendly and knowledgeable person as an apple computer type, while the Microsoft computer person was portrayed as a stiff, geeky, awkward person. Apple was trying to create comparative:

answer

brand personalities

question

one of the major tools used by marketers to meet the needs of loyal customers :

answer

CRM

question

frequent buyer/user award programs are used to :

answer

maintain contact with loyal customers

question

brands can be owned by:

answer

any firm in the supply chain

question

another name for a manufacturer's brand is a :

answer

national brand

question

the basic reason manufacturers spend time and money building their own brand is to :

answer

build brand equity

question

brands that are owned by __ are called private label brands

answer

retailers

question

private label brands that are owned and managed by :

answer

retailers

question

which of the following types of products and services is most likely to be sold without a brand name :

answer

onions

question

consumers might not realize that old spice health and wellness products and Iams pet nutrition products are made by the same company. they are examples of

answer

individual brands

question

when proctor and gamble added teeth whitening products under the crest brand, the firm was engaged in:

answer

brand extension

question

shell master card, created cooperatively by shell oil company and master card is an example of:

answer

co-branding

question

efforts to change a brands focus to target new markets or change the image of a brand are called:

answer

brand repositioning

question

secondary packaging:

answer

can provide info. to consumers not found on the primary packaging. is important to the retailer in terms of convenience in handling. can be an important positioning tool by helping to convey the branding image. can allow for cost efficiencies due to larger order and shipment sizes.

question

which is not one of the important functions of labels on products and packages?

answer

protecting against damage to the product

question

what u.s , gov. agency reviews food and packaging labels to ensure claims made by the manufacturer about the product are true?

answer

food and drug administration

question

one of the advantages of selling specialty goods and services is that when consumers want them, they will:

answer

search for them

question

zappos, an online show company, knows shoes are typically a ___good, with consumers often spending time comparing alternatives. they overcome that, aspect of consumers' search process by offering a free, no questions asked return policy

answer

shopping

question

marketers selling milk , bread, and other consumer staples, know most customers do not spend much time searching or comparing alternatives. for most consumers, these are ___goods

answer

convenience

question

marketers need to think about the product offer on three levels. which of the following levels includes associated services such as warranties, financing, support and after-sale service?

answer

augmented product

question

when manufacturers try to understand what customers are looking for, they are thinking about the ___component of the product offer.

answer

core customer value

question

when a company launches a new product with an existing brand name this is known as:

answer

a brand extension

question

when a salesperson approaches you to sell a cemetery plot, this is considered what type of product?

answer

unsought product

question

when politicians sell themselves like toothpaste, then it would be nice if the voter could have the same assurance that the claims they make were tested for validity with the same rigor that toothpaste manufacturers are required to follow.

answer

true

question

place is the most strategic of the four P's

answer

true

question

A(n)___is the set of institutions that transfer the ownership of and move goods from one point of production to the point of consumption

answer

marketing channel

question

what is true about distribution centers?

answer

they enable retailers to carry less merchandise in individual stores.

question

A(n)___ is a supply chain whose members act like a unified system

answer

vertical marketing system

question

a(n)__is a document used by blocking a forklift driver indicating how much of each item to get from specific storage areas

answer

pick ticket

question

A(n)___is a 13 digit code retailers can use to track inventory

answer

UPC

question

when cynthia's boutique receives dresses, they already have price tags and are on hangers. Cynthia's boutique receives___merchandise

answer

floor-ready

question

because of its size and market power, walmart is able to operate a(n)___supply chain.

answer

administered

question

in an administered vertical marketing system

answer

there is no common ownership, and the dominant member has significant power to impose its ideas and objectives.

question

franchising involves a(n)___supply chain

answer

contractual

question

franchising represents a popular version of a contractual vertical marketing system where:

answer

the franchise operates a retail outlet using the name and format of the franchisor, for which the franchisee pays a fee plus royalty. a franchisor provides assistance with locating the business, developing products, advertising and management. The franchise can combine entrepreneurship with the advantages of a coordinated marketing channel. the franchisor has incentives through the royalties to continue to innovate and improve operations.

question

in a corporate vertical marketing system:

answer

the participants-such as warehouses, transportation companies, and retail outlets--are typically owned by a parent company to ensure harmonious relations throughout the supply chain

question

in a(n)___supply chain, none of the participants has any control over the others .

answer

conventional

question

in an independent supply chain, the participants collaborate solely on the interactions between the immediate customer and supplier. on the other hand, in a vertical marketing system:

answer

firms work together with a common on the customer or operation of the supply chain. Ownership may overlap, but the emphasis is on working toward common goals and objectives. long-term relationships are more important than gaining a temporary advantage. supply chain members work as a unified system.

question

although conflict is likely to occur in any supply chain, it is generally more pronounced when:

answer

the supply chain members are independent entities

question

yesterday, lorinda overheard a surprisingly unpleasant encounter between the manager of a hardware store where she works and a sales rep who sells a well-known line of tools. the rep insisted that his tools should be more prominently and that a better assortment would mean more sales. the manager had other plans and told him so , and the conversation turned into a loud argument. what lorinda observed is an example of:

answer

supply chain conflict

question

one of the benefits of shortened lead times associated with a jit system is:

answer

better forecasting because firms are not forecasting as far into the future

question

shorter lead times allow retailers:

answer

to reduce the needed level of inventories

question

after installing an electronic data interchange, kay jewlers was able to reduce___, the amount between the recognition that an order needs to be placed and the arrival of the needed merchandise

answer

lead time

question

manufacturers trying to implement a just-in-time delivery system need to start with:

answer

information about customer demand

question

customers have little knowledge of or concern for inventory control. customers want:

answer

the right products that meet their needs

question

rick is adapting the new routing software his company bought for its distribution center . he will likely include information about__in the software program in order to maximize distribution efficiency.

answer

rate of sales at various stores, road conditions, truck capacity, store operating hours.

question

ticketing and marketing refers to :

answer

creating and placing price and identification labels

question

some retailers require their suppliers to ship merchandise ___,thus eliminating the time and expense associated with ticketing and marketing

answer

floor-ready

question

merchandise that arrives in the delivery truck ready to be sold is considered:

answer

floor-ready

question

RFID offers participants in the supply chain a powerful tool for tracking inventories and reducing handling. the main reason why it has Not been more widely adopted is that:

answer

RFID is expensive to use

question

___has dramatically reduced the time and labor associated with checking and receiving merchandise

answer

RFID

question

in a pull supply chain,___

answer

orders for merchandise are generated at the store level based on sales data captured at POS terminals.

question

in CPFR inventory management systems, ___

answer

retailers send sales information to the manufacturer.

question

CPFR refers to ___ inventory management systems.

answer

collaborative planning , forecasting, and replenishment

question

when electronic data interchanges (EDIs) are used to describe the benefits of new products and provide pictures and information they support the___ element in the four Ps of marketing

answer

promotion

question

as a very small golf equipment manufacturer , dr. putt maintained information using bookkeeping and inventory management software and communicated with customers through email. As business expanded, dr. putt needed an electronic data interchange system that would allow him to:

answer

receive sales data . initiate purchase orders. send and receive invoices . receive returned merchandise documentation

question

traditionally, marketing channel management has been the responsibility of:

answer

marketing departments

question

traditionally , logistics has been the responsibility of:

answer

operations

question

in marketing's four P's , place refers to all activities required to get:

answer

the right products to the right customer when that customer wants it

question

logistics managers tend to focus on marketing sales while marketing managers tend to focus on keeping costs low

answer

false

question

logistics managers and marketing managers ought to focus on making profitable sales and retaining profitable customers by delivering the solutions that their targeted customers want more effectively than competitive marketing systems

answer

true

Marketing 210 midterm #3part 1 – Flashcards

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