Marketing Test 3.06-3.07 LAPS

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In which of the following businesses would a separate department most likely be responsible for establishing prices
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Chain store
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In which of the following businesses is the business owner usually responsible for setting prices
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Java Joe’s Coffee Shop
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Covering costs is a pricing objective related to
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profitability
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What would be the most appropriate pricing strategy for a business in a small town where unemployment has skyrocketed and the economy is in a downturn
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Flexible pricing
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To set prices, businesses must price the physical product and all of its associated
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services
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Informing, persuading, or reminding customers about products is known as
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promotion
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Which of the following elements of the marketing mix involves decisions about shipping, handling, and storing items
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Place
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Company goals that influence how marketers make pricing decisions are called
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pricing objectives
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Sellers must carefully set prices so that buyers feel they are receiving __________ value for their money
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optimum
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Can pricing affect a business’s image
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Yes; a business with low prices may have a discount image.
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When companies increase the quality of materials used in the production of their products, their prices will tend to be
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higher
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Deciding what goods, services, or ideas to produce or sell to satisfy customers’ needs is known as making __________ decisions
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product
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Does pricing affect the amount of money a business spends on product research
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Yes; companies will not spend as much on research for lower priced products.
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Wal-mart and Sears attract two different types of customers because of their pricing strategies. They have established their prices based on _____ decisions
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customer
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A station across the street is offering gasoline for five cents cheaper per gallon. The other stations in the area decide to lower their prices as well. This is an example of ______ pricing
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competitive
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Which area of promotion will pricing affect
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Advertising budget
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The amount of money that a buyer is willing to pay and a seller is willing to accept for a product is known as
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exchange price
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Can prices be set too low
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Yes; customers may feel quality is too low.
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A downturn in the economy has forced a home builder to lower its prices. This company has __________ prices
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flexible
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What might happen if a business’s customers feel that they are not getting the most value for their money
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Customers spend money elsewhere
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What costs do businesses usually include in the price of their products
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transportation
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With what do many customers associate price
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Quality
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The determination of an exchange price acceptable to both the buyer and the seller of a product is called
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pricing
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What is an external factor that affects the price that a business charges for its products?(StateNC?)
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Economic conditions
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Erica wants to buy Marco’s used iPod. He is asking her to pay him $100 for it. $100 is the iPod’s
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selling price
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Which of the following factors related to a business’s objectives and strategies affects its pricing
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Product mix
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Which of the following is prohibited by government regulation
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Businesses advertising a product claiming reduced price but only sold for a short time at higher price
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Which of the following is not something a business must accomplish through selling price
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Maintain market share
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The selling prices of products help customers to
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make buying decisions.
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Jack’s General Store has advertised a big sale on toasters. When Wendy goes to the store to buy a toaster, the salesperson tells her they are all sold out and offers to sell her a higher priced toaster oven. This is an example of an illegal practice known as
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bait-and-switch advertising.
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The national economy is always changing. These ups and downs in economic activity are known as
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business cycles.
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The majority of businesses that use profit-oriented pricing want to:.
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earn a reasonable amount of profit
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Most marketers feel that it is a good strategy to price their products according to the
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way their customers view the products.
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Is the following statement true or false There is no connection between a firm’s marketing objectives and its pricing objectives:
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False; pricing objectives should be used to achieve marketing objectives.
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In which of the following forms of competition are no substitutes readily available
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Monopoly
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Which of the following is true of a business’s pricing objectives
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They must be adjusted from time to time.
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It costs a publishing company $8 to produce a paperback book. The company sells each paperback it produces for $9.99. The $1.99 difference is known as
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mark-up
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What happens when demand for a product goes up
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Producers make more of it.
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The objective of pricing that is intended to earn a certain percentage of profit based on the amount of
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return on investment.
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Why is obtaining, maintaining, or increasing market share important to a business
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Market share serves as a measure of the success of the business.
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Businesses that come under government control often set a target return of profit because they
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may be investigated if they earn high profits.
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A business charges a small company a higher price for a product than it charges a large company for the same product. What does this represent
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Price discrimination
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Which of the following is a true statement
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There are many kinds of selling prices for goods and services.
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A business that sets its prices lower than those of competitors will not make a profit unless it also
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controls its costs.
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In what type of market do companies compete by making their products different from each other as to quality, service, styles, and prices
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Monopolistic competition
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Selling price helps customers to allocate their money because price determines
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what customers can afford to purchase.
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What kind of competitive market is characterized by a great many buyers and sellers of nearly identical products and marketers who have little control over pricing
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Pure competition
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Companies A, B, and C sell similar products. Together, they recently agreed to sell their products for the same price. In what unethical activity are the businesses engaging even if the price would be considered fair
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Price fixing
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A business that uses sales-oriented pricing objectives wants to increase the
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total amount of its income from sales.
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If a producer priced its products much lower than those offered by competitors, is it possible that the producer would lose customers
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Yes; the price may be so low that the producer is unable to perform certain duties.
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Why is it important for businesses to recover their costs
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So that they can stay in business
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The goal of channels of distribution is to move products from producers to
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final consumers
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Channels of distribution benefit consumers by
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making a variety of products available to them
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Channels of distribution benefit businesses by
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getting their products to consumers more efficiently
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Providing marketing information is an important channel activity. Businesses rely on marketing information to determine
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their target markets’ needs and wants
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The costs of promoting products are often
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shared by channel members
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Retailers perform an important channel activity by negotiating with consumers on issues such as
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delivery
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A wholesaler breaks down a large shipment of a product and sells portions of it to several retailers. The wholesaler is reducing a discrepancy of
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quantity
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A retailer buys a variety of toys from a number of different producers and makes them all available for sale in the same place. The retailer is reducing a discrepancy of
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assortment
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Channels of distribution allow channel members to share
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risk
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Channel members add value to a product by
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performing certain channel activities expertly
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Which of the following is NOT a condition that must exist for channels to be effective
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They must have at least five members
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Channel members should share an equal commitment to the product’s
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quality
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The first decision that marketers must make when managing channels is
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setting channel objectives
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Producers who eliminate all middlemen in the channel are said to be using _____ distribution
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direct
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Marketers determine distribution intensity so they can achieve
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ideal market exposure
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When marketers are trying to reach the greatest number of consumers possible, they use a(n) __________distribution pattern
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intensive
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Which of the following products would likely use an exclusive distribution pattern
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A large piece of farm machinery
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The total number of members in a channel is called
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channel length
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A channel task should be performed by the channel member who
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performs it best
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A producer feels that a retailer is not marketing its product to final consumers aggressively enough. This is an example of
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vertical conflict
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Who is often closer to final consumers than producers are and can provide valuable marketing information
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intermediaries
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Marketers use _________ distribution to maintain tight control over a product
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exclusive
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__________ are businesses that buy consumer goods or services and sell them to ultimate consumers.
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retailers
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Marketers want to achieve ________ by making their product available to each and every customer who might buy it
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ideal market exposure
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___________ are financial penalties assessed for a variety of problems, such as late shipments or damaged merchandise
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chargebacks
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An advantage for producers in using the producer to wholesaler to retailer to consumer distribution channel is that
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wholesalers usually buy in large quantities
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Which of the following is an example of an industrial user
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A hairstylist buying new scissors to perform haircuts
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Which of the following intermediaries never actually owns the products it promotes and sells
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Agents
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Which indirect channel of distribution is used to reach large retailers when the producer does not want responsibility for the selling activities
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Producer to agent to retailer to consumer
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Top-Notch Wheels buys mountain bikes from The Great Colorado Mountain Bike Company and sells them to bike shops. Top-Notch Wheels is an example of a(n)
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wholesaler
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Intermediaries buy large quantities of goods from producers and sell smaller quantities to other intermediaries or to consumers. The result is that intermediaries __________ producers per-unit cost for goods
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reduce
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Which of the following is a benefit of channels of distribution
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We can more easily obtain products from all over the world
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The use of intermediaries enables producers to make larger profits because intermediaries
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may sell more than the producer could sell on its own
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What is the most common channel of distribution for large industrial goods
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Producer to industrial user
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Quality Distributors buys electrical equipment and supplies from ABC Electric and sells them to local electrical contractors. Quality Distributors is an example of a(n)
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intermediary
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Where does a channel of distribution begin
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With the producer
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Which of the following services would be distributed by a producer to agent to consumer channel
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Travel planning
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Wal-Mart, Domino’s Pizza, and Avis Rent-a-Car are examples of
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retailers
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What distribution channel is used for high-priced industrial goods when the producer does not have its own sale force
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Producer to agent to user
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Producers are able to match their production to the needs of consumers or industrial users because intermediaries
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develop an assortment of goods
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Which of the following is an example of an ultimate consumer
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A teenager buying her/his first car

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