Entrepreneurship - Pricing Review

A buyer is willing to pay $12.99 for a product. If the seller is willing to accept $12.99, then that amount is the

• markdown

• value

• exchange price

• markup

What might happen if a business's customers feel that they are not getting the most value for their money?

• Customers purchase more

• Sales remain the same

• Customers spend money elsewhere

• Sales increase

Can a business set the price of their product too low?

• No, the lower the better

• Yes, customers may feel quality is low

• No, the lower the price the more customers will buy

• Yes, customers may feel quality is too high

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

• competition has sold the good

• the price is twice the cost

• a large profit is made

• the good will sell

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:

• Supply

• Promotion

• Product

• Place

A downturn in the economy has forced a home builder to lower its price. This company has ______ prices.

• realistic

• flexible

• competitive

• inflexible

To set prices, businesses must price the physical product and all of its associated

• features.

• services.

• value.

• physical characteristics.

In which of the following businesses would a separate department most likely be responsible for establishing prices?

• A small boutique

• Local clothing store

• Hair solon

• Chain store

Which of the following is a product factor that sandwich shops consider when deciding on the price to charge for menu items?

• Method of delivery

• Amount of advertising

• Cost of food

• Type of decor

1. Businesses might consider increasing their prices during times when

• Goods and services are plentiful

• Economic conditions are good

• Many people are unemployed

• Customers have less disposable income