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Question;1. A major circumstance provoking price;increases is ________.;a. market demand;b. profitability versus target;c. cost inflation;d. price versus competition;e. stock price versus target price;2. Companies often raise their prices;by more than the inflationary cost increases as preparation for further;inflation or government price controls.;This practice is known as ________.;a. anticipatory pricing;b. delayed quotation pricing;c. escalator pricing;d. unbundling;e. discount pricing;3. Generally, consumers prefer;price increases on a regular basis to sudden, sharp increases.;a. large;b. consistent;c. small;d. reciprocal;e. trade;4. Given strong consumer resistance to price;hikes, marketers go to great lengths to find alternative approaches that will;allow them to postpone a price increase. Which of the following is NOT one of;these approaches?;a. Reduce or eliminate some product features.;b. Reduce or eliminate some services, such as;free delivery.;c. Shrink package sizes.;d. Demand upfront payment before shipping;goods.;e. None of the above;5. In markets that are characterized by;products that are highly homogenous, how should a firm react to a competitor?s;price decline?;a. Reduce product performance levels.;b. Enhance services.;c. Reduce services.;d. Reduce product characteristics.;e. Augment the product.;6. Some of the considerations that companies;face when deciding to match a competitor?s price decline include the product?s;importance in the company?s portfolio, the competitor?s intentions, and the;a. reaction by the channels of distribution;b. shareholder value;c. market?s price and quality sensitivity;d. ordering time frames for the product;e. ordering ease for the product;True/False;7. Price is one of the two elements of the;marketing mix that produce revenue.;8. A well-designed and marketed product can;command a price premium and reap big profits.;9. All products have experienced heavy;discounting in recent years.;10. The Internet is largely a one-sided tool;that benefits buyers, but not sellers.;11. In large companies, pricing is typically set;by the boss.;12. Consumers are ?price takers? and accept;prices at ?face value? or as given.;13. Purchase decisions are based on how;consumers perceive prices and what they consider the current actual price and not;the marketer?s stated price.;14. Although consumers may have fairly good;knowledge of the range of prices involved, very few can accurately recall;specific prices of products.;15. Many consumers use price as an indicator of;quality and value.;16. Research on reference prices has found that;?unpleasant surprises??when perceived price is lower than the stated price?can;have a greater impact on purchase likelihood than pleasant surprises.;The price a firm charges for its product does not;affect where it chooses to position the product in the marketplace.;17. Consumers often rank brands according to;price tiers in a category.;18. Most firms have no trouble estimating the;demand and cost functions for their products.;19. Trying to maximize market share, a firm;would be best served to use a market-skimming pricing strategy.;20. When prices start off high and are slowly;lowered over time, this is called market-skimming pricing.;21. Nonprofit organizations have the same;pricing objectives as private enterprise.;22. In the case of prestige goods, the demand;curve sometimes slopes upward.;23. Companies prefer customers who are less;price sensitive.;24. Price elasticity depends upon the magnitude;and direction of the contemplated price change.;25. A price indifference bandis that section of the price increase in;which the consumer does not notice or does not have any effect in demand.;26. The price elasticity of demand rarely;varies between the short and long term.;27. Price elasticities are higher for;individual items than for overall brands.;28. Activity-based;cost accountingis just another method to distribute attributable costs;across the product line.;29. Total;costs consist of the sum;of the fixed and variable costs associated with the product.;30. In target-return pricing, the firm determines the markup required and;adds that amount to the fixed cost of the product.;31. An increasing number of companies;are basing their pricing on perceived;value,which is the value;that the consumer decides the product is worth and is the same across all;incomes and regions of the company.;32. The key to effectively using perceived-value pricing is always to;deliver the same or equal value as your competitors.;33. Value;pricing is a matter of;reengineering the company?s operations to become a low-cost producer.;34. EDLP pricing;is a type of going-rate pricing in which the retailer sets low prices everyday;on selected items.;35. The final price charged by the company does;not necessarily have to take into account the brand?s quality and advertising;relative to competition.;36. In some cases, price is not as important as;quality and other benefits in the market offering.;37. Management need not consider how;the marketing/distribution channels will react to its pricing policies.;38. When the seller receives full payment in;cash and agrees to spend a substantial amount of the money in a country within;a stated time period, this is called offset.;39. A quantity;discountis a price reduction given to those who buy a large volume of the;manufacturer?s products.;40. Price discrimination in all forms;is illegal in the United;States.;41. Psychological discounting involves setting;an artificially high price and then offering the product at substantial;savings.;42. When firms charge different prices to;different consumer groups (senior citizens for example), this is a form of;price discrimination and is illegal.;43. Predatory pricing?selling below cost with;the intention of destroying competition?is legal under certain conditions.;44. Companies sometimes initiate price cuts in;a drive to dominate the market through;lower costs.;45.;A;major circumstance provoking price increases is cost inflation.;Essay;101.;Explain;why and how the Internet is partially reversing the fixed price concept of;retailing?;102.;Prior;research has shown that although consumers may have fairly good knowledge of;the range of prices involved, surprisingly few can recall specific prices of;products accurately. When examining products, consumers often employ reference;prices. List the possible prices consumers use as their ?reference.?

 

Paper#47306 | Written in 18-Jul-2015

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