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WorksheetsMM-2_Pricing Quiz
Total questions: 40
Worksheet time: 22mins
The minimum price which can be charged bounded by product cost is also known as
Price Floor
Price Fixation
Price ceiling
Basic price
Companies use several pricing techniques to stimulate early purchase. which of the following best explains psychological discounting?
An artificially high price is set on the product and then substantial discounts are offered on the same
A longer loan period is given to the customer. there are lower monthly payments
special prices are tagged
Cash rebates
which of the following is correct for the costs related to production
fixed cost
Variable cost
Average cost
All the above
In case of a telephone bill, we need to pay the fixed monthly charges and the usage charges as well. which of the following pricing strategy the telecom follow?
Optional feature pricing
captive product pricing
two-part pricing
BY product pricing
which is an external factor for the product pricing
Organisation factors
marketing mix
cost of product
product demand
Two or more complementary products offered together at a single price is know as
Bundle pricing
Transfer pricing
going rate pricing
Full cost pricing
The price-setting method which most closely corresponds to the concept of product positioning is
cost-plus pricing
going rate pricing
perceived value pricing
Psychological pricing
Which of the following is the most common method of pricing?
Full cost pricing
Marginal cost pricing
going rate pricing
competitive pricing
What is the point at which sales revenue equals the costs and expenses of making and distributing a product?
Revenue Balance
Break Even Point
Profit Point
Cost Equilibrium
Which factor determines whether demand is elastic or inelastic based on the availability of substitute products?
Price relative to income
Availability of substitutes
Brand loyalty
Urgency of purchase
What is the primary goal of pricing for marketers?
Increasing advertising expenditures
Meeting the competition
Gaining market share
Earning a profit
Which factor determines whether demand is elastic or inelastic based on luxury versus necessity?
Urgency of purchase
Luxury versus necessity
Brand loyalty
Price relative to income
Product Line
A group of closely related products within the product mix
The physical movement of products through the channel of distribution
The specific model, color, or size of products in a line
The amount added to the cost to determine the selling price
What is the main challenge for market leaders and firms trying to build a market share?
aggressive price cutting
salary increase
adding manpower
creating a different strategy
It sums the reactions of many individuals who have different price sensitivities.
Price Strategy
Price Experiments
Price Sensitivity
Price Elasticity
Many brands strive to be "affordable luxuries" or products or services characterized by high levels of perceived quality, taste and status with a price just high enough not to be out of consumer's reach.
Product Leadership
Quality Leadership
Product - Quality Leadership
Quality - Product Leadership
Which of the following can companies do in the case of declining profit margins INSTEAD of passing the extra cost to the consumer?
Companies must always pass the extra cost to customers
Reduce the size of the product and increase the price
Reduce the size of the product and decrease the price
Reduce the size of the product instead of increasing the price
What is marketability a measure of when considering a new smartphone model for production?
The profitability of each sale
The ease of selling the smartphone model
The popularity of the smartphone model
The consumability of the smartphone model
Why might a clothing store discount heavily on winter jackets to make room for spring collections as the seasons change?
To increase the popularity of old stock
To avoid perishable goods spoilage
To clear out seasonal items
To improve the marketability of new products
What is price skimming?
An initially high price charged to customer which will reduce over time
An initially low price charged to customer which will increase over time
A steady price charged to customer regardless of product age
What is an advantage of price skimming?
Gains market share
Covers costs and breaks even
Allows an organisation to make the largest profit possible
What is Promotional pricing?
When a business offers different prices to different customers
When a business reduces price to below production cost to clear stock
When a business offers a short term special offer such as buy one get one free to gain interest and increase sales
What is meant by Psychological pricing strategy?
Items are offered at an uneven number to appear cheaper encouraging sales (eg £9.99)
Items are sold using a special promotional offer which is brightly coloured and attracts attention
Items are sold at production cost price to attract customers into the store and increase purchases
Which is not a stage of the product life cycle?
Product development
Introduction
Decline
Maturity
Competitive growth
In this stage:
•Low sales
•High cost per customer acquired
•Negative profits
•Innovators are targeted
•Little competition
Product development
Introduction
Growth
Maturity
Decline
In this stage:
•Rapidly rising sales
•Average cost per customer
•Rising profits
•Early adopters are targeted
•Growing competition
Product development
Introduction
Growth
Maturity
Decline
In this stage:
•Sales peak
•Low cost per customer
•High profits
•Middle majority are targeted
•Competition begins to decline
Product development
Introduction
Growth
Maturity
Decline
Which of the following presents the strongest reason that markup pricing generally does NOT make sense?
Sellers earn a fair return on their investment.
By tying the price to cost, sellers simplify pricing.
When all firms in the industry use this pricing method, prices tend to be similar.
This method ignores demand.
With a standard markup, consumers know when they are being overcharged.
Which of the following would NOT support a market-skimming policy for a new product?
The product's quality and image must support its higher price.
Enough buyers must want the products at that price.
Competitors are not able to undercut the high price.
Competitors can enter the market easily.
The cost of producing a smaller volume is not so high that it negates the advantage of charging more per unit.
It is most typical for producers who use captive-product pricing to set the price of the main product ________ and set ________ on the supplies necessary to use the product.
low; low markups
high; low markups
low; high markups
high; high markups
moderately; moderate markups
The Internet offers ________, where the price can easily be adjusted to meet changes in demand.
captive pricing
dynamic pricing
basing-point pricing
price bundling
cost-plus pricing
Select the technique and example used in pricing products.
Technique:
Pricing several complementary products together for one price.
Example:
Pricing a video game console, accessories and 2 games all together for $160.
Odd-Even Pricing
Prestige Pricing
Multiple Unit Pricing
Bundle Pricing
