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Exam 19: Pricing Concepts

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Question 41

Multiple Choice

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A deduction from list price for purchasing large quantities aggregated over a stated period of time is a

A) noncumulative quantity discount.
B) additive cash discount.
C) cumulative quantity discount.
D) cumulative discount allowance.
E) additive quantity reduction.

F) None of the above
G) A) and C)

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Question 42

Multiple Choice

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​Which of the following statements is true about marginal analysis? ​

A) Fixed costs vary with changes in the number of units sold.
B) Total cost is the sum of average fixed costs and average variable costs times the quantity produced.
C) Average variable cost equals variable cost times number of units sold.
D) Average fixed cost increases as the number of units produced increases.
E) Marginal cost equals fixed costs minus variable costs.

F) B) and E)
G) D) and E)

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Question 43

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The point at which marginal revenue equals marginal cost is the breakeven point.

Which of the following products is most likely to have an inverted C-shaped demand curve?

What are the differences among value-conscious, price-conscious, and prestige-sensitive customers?

Which of the following statements is true about the factors that affect pricing decisions?​ ​

Ideally, pricing decisions have little relation to a firm's marketing objectives.

You and a partner have are planning to open a dollar discount store in your hometown. You plan to sell the majority of the items in the store for one dollar unit price. You have seen this concept work well in other cities and you believe the demographics of your hometown are a good fit for this retail concept.Which of the following types of customers are you expecting to frequent your store? ​

What are the terms of F.O.B. pricing?

If a product has an inelastic demand and the manufacturer raises its price,

Scenario 19.2 Use the following to answer the questions.The BASF Chemical Company in Germany has developed a new rubberized coating. The product has an application for cell phones and other hand-held electronic devices that gives them protection from falls and scratches. BASF plans to market the product directly to businesses that manufacture the casings for these types of products. BASF currently uses a system of salespeople headquartered in Germany, while its primary business customers are in China. -Refer to Scenario 19.2. BASF is considering the problem of actual distance in delivering its product from the plant in Germany to some of its customers in China. Which pricing strategy would help overcome this problem?

Which of the following is true about price competition? ​

When marketers emphasize price as an issue and match or beat the prices of other companies, they are using

Customers always interpret a higher price to mean higher quality.

Profit margins for marketing channel members must be considered when determining the price of a product.

Price is considered to be the variable in the marketing mix that is

Marketers have no flexibility in setting prices under conditions of

Laura Spangler, of North Central Novelties, reduces the price of games sold to Robertson's Entertainment by 10 percent to allow for expenses associated with Robertson's promoting the games to consumers. This is an example of a ____ discount.

In conducting an assessment of her accounting firm, Paige discovers the following annual results: average charge per customer = $250; rent = $12,000; total billings = $150,000; employee compensation and benefits = $60,000; and other costs = $110,000. Given these results, Paige's profits would equal

Suppose that the frozen foods division of Swanson purchases food trays and boxes from the packaging division. The form of pricing used to charge the frozen foods division is called