Spring 2024 Pricing Study Guide

A satisfactory price means:

• that the consumer views the purchase as a value

• A business makes a profit on the sale

• Both a & b

• None of the above

____ establishes and communicates the value of products and services to prospective customers.

• Advertising

• Promotion

• Marketing

• Pricing

All of the following are goals for pricing EXCEPT

• Gaining market share

• Getting a high return on investment

• Having the lowest prices and profit margins

• Pricing competitively

Pricing is important because it establishes and maintains

• Competitive edge

• Image

• Profits

• All of the above

____ describes the relationship between changes in a product’s price and the demand for that product.

• Utility

• Elasticity of Supply

• Elasticity of Demand

• Economics

When the price of a diabetes medicine jumped from $100 a month to $500 a month, David still purchased the product because it is necessary for his survival. This is an example of

• Elasticity of Supply

• Inelastic demand

• Inelastic Supply

• Elasticity of Demand

Rack Room Shoes advertises that customers can purchase one pair of shoes and get the next pair for $5. The sale is very effective, and inventory is greatly diminished. This is an example of __________.

• Elasticity of Supply

• Inelastic demand

• Inelastic Supply

• Elasticity of Demand

If there is a small supply of the product, but the quantity demanded is high the price will usually be __________.

• High

• Low

• Depends on business

• Buyer’s market

If there is a large supply of the product and the quantity demanded is low, the price will usually be __________.

• High

• Low

• Depends on business

• Seller’s market

The point at which sales revenue equals the cost and expenses of making and distributing a product is __________.

• Surplus

• Shortage

• Inelastic demand

• Break-even point