The Nature of Pricing - Pretest

Costs to consumers of airline tickets and legal advice are examples of

• competitive services.

• optimum values.

• prices.

• goods.

After a good is produced, the price of that good should be set at a point at which

• a large profit is made.

• the good will sell.

• the price is twice the cost.

• competition has sold the good.

The prices of services in a new business are about the same as those of similar businesses in the area. This is an example of pricing that is

• flexible.

• strategic.

• realistic.

• competitive.

Which of the following statements about pricing is true:

• The selling price can never be set too low.

• The cost of the product determines its selling price.

• Once prices are set, businesses should not adjust them.

• The price must satisfy both buyers and sellers.

Business A spends less on advertising than Business B. Both businesses sell the same products, but Business B charges higher prices than Business A. Which of the following factors has affected the prices of the businesses:

• Product

• Place

• Supply

• Promotion

Businesses might consider increasing their prices during times when

• many people are unemployed.

• goods and services are plentiful.

• economic conditions are good.

• customers have less disposable income.

Large companies that use sophisticated methods for setting the prices of their goods and services often rely on information from

• news magazines.

• government agencies.

• marketing research.

• private investors.

A business priced a new product well below the current market price. Sales were very low because many customers believed the product was of poor quality because of its low price. In this situation, the seller did not set a __________ price.

• legal

• flexible

• realistic

• competitive

What pricing strategy would be most effective for a business that wants to create an image of very good quality and prestige?

• High

• Discount

• Wholesale

• Moderate

The price a business sets on a particular product often has an effect on the business's choice of a(n) __________ to promote that item.

• medium

• slogan

• agency

• visual