question

For a firm, rent, landscaping and insurance are best examples of:

answer

Fixed Costs

question

A firm may set low prices to:

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-Encourage current firms to leave the market - take market share away from competitors -discourage firms from entering the market

question

In many geographic areas, utilities such as water and electricity are available from only one provider. This is an example of a level of competition called a:

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monopoly

question

Firms engage in competitor orientation might use which of the following strategies

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Competitive parity status quote pricing

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The percent change in the quantity of one product demanded compared with the percent change in price in another product is:

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cross-price elasticity

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Total cost is:

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variable cost plus fixed costs

question

The ________ makes up one of the Cs of the fice Cs of pricing

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customer

question

Demand curves can be described as

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curved or straight

question

a down-ward sloping demand curve for a product like teeth-whitening kits show

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as price increases, demand decreases

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Some specialty retailers attempt to compete, not by setting low prices, but by justifying higher prices through high levels of personalized service. This is an example of a _____ orientation to pricing

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customer

question

Employing _______ pricing, a firm sets a very low price for one or more of its products with the specific intent to drive its competition out of business

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predatory

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A ________ price is the benchmark price against which buyers compare the actual selling price of the product

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reference

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The types of strategies that could be implemented in a profit orientation strategy include:

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-target return pricing - maximizing profits strategy

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What are monetary sacrificing included in the overall price?

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Shipping & Travel Costs

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The Five Cs of pricing are: Company objectives, customers, channel partners, competition, and __________

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costs

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Some retailers prefer a __________ strategy which relied on the promotion of sales, during which prices are temporarily reduced to encourage purchases

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high/ low pricing

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if a firm sells the same product to different re-sellers at different prices it can be considered ________ ____________. However, in some cases, such as offering quantity discounts, is considered acceptable by law.

answer

Price Discrimination

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By reducing consumers' search costs, ____ adds value because consumers can spend less time comparing prices, including sale prices, at different stores

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everyday low pricing (EDLP)

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Channel members include which of the following

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Manufacturers, Retailers, Wholesalers

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Profit alone _______ how many units should be sold before a firm breaks even

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does not indicate

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When only a few firms dominate, it is known as __________ competition

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oligopolistic

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break-even analysis examines the relationships between which of the following?

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cost, profit, and price

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Manufacturers often set a (n) ______ and attempt to require retailers to sell their merchandise at this price

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MSRP manufacturer's suggested retail price.

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A useful technique that enables managers to examine the relationship among cost, price, revenue, and profit over different levels of production and sales is called _______.

answer

break-even-analysis

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Variable costs _______ production volume

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change with

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When a new product is similar to what already appears on the market _____ is somewhat easier because the product's approximate Value has already been established

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pricing

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in the customer orientation strategy, firms might sell their products or services at high prices in order to:

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-Enhance the company's reputation and image - enhance the value of the products in consumers' minds - communicate exclusivity

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Price is the one element in the marketing mix that:

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generates revenue

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Firms that believe increasing sales will help the firm more than increasing profits use the:

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sales orientation strategy

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What are the characteristics of horizontal price fixing?

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-Competitors that produce and sell competing products collude - Price is taken out of the decision making process for consumers

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The saying, "you get what you pay for" indicates that price provides information about:

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The quality of product or service

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When consumers perceive that different companies sell products that are commodities, it is known as:

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pure competition

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Although it is not always the case, many firms expect the unit cost to drop significantly as the accumulated volume sold increases, an effect known as the _______ ________effect.

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experience curve

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A break even analysis graph contains which of the following

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Fixed costs, Total Revenue, and Total Costs

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Some states prohibit ____ pricing, where items are sold at a price below the store's cost, by requiring some minimum markup

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Loss Leader Pricing

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Firms using a ________ Strategy set the initial price low for the introduction of the new product or service

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Market Penetration strategy

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When there are many firms competing for customers in a given market, but the products are differentiated, it is known as:

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monopolistic competition

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some limitations to break-even analysis are:

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-That it represents an average price to account for variances - it cannot predict how many units will sell - that firms have to perform several analyses at different quantities

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When sellers advertise items for a very low price without the intention of selling any of those items, it is known as:

answer

balt and switch

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When developing a pricing strategy, channel members should:

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clearly communicate their pricing goals to one another

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potential drawbacks of a market penetration pricing strategy

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-"leaving money on the table" - Need large production capacity - Low quality perception

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Price fixing is the practice of colluding with other firms to _______ prices

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control

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Price is ________ of the four Ps to manage

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the most challenging

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The five Cs of pricing include

answer

company objectives

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What is essential to prove a complaint for predatory pricing in the market?

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-Evidence that the firm intends to drive out competition -Evidence that the prices charged are below the store's average cost

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Benefits of a market penetration pricing strategy

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-Discourages potential competitors - potential to build sales -potential to gain market share -potential to earn profits

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A _______ pricing strategy can be used when innovators and early adopters are willing to pay a higher price to obtain a new product or service

answer

price skimming

question

The equation for elasticity of demand is the percentage change in quantity demanded, divided by percentage change in:

answer

price

question

Strategies that can be used as part of the profit orientation strategy include:

answer

-Target profit pricing -target return pricing -maximizing profits strategy

question

Advertisements should never ________ the consumer to the point of causing harm

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deceive

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What are the benefits of the high/low pricing strategy.

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-attracts consumers at both ends of the price-sensitivity scale -it serves two different market segments -it creates excitement due to the limited duration of sales

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There are many forms of price discrimination, but only some of them are considered illegal under the following legislation

answer

Robinson-Patman Act & Clayton Act

question

Price times quantity is:

answer

total revenue

question

When a firm is able to use mathematical mode that can explain and predict sales, it is able to implement the:

answer

Maximizing profits strategy

question

When incomes drop, the demand for an elastic product:

answer

tends to decrease

question

if a firm initially sets prices similar to major competitors' prices, this is an example of ______ pricing

answer

competitive parity

question

contribution per unit

answer

the price, minus the variable cost per unit

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