Marketing Chapter 14 Determining The PriceProfessor Myles Bassell page Question The first handheld calculators were priced at several hundred dollars
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Question
The first handheld calculators were priced at several hundred dollars
so that its manufacturer could recoup research and development costs.
Even though the first calculators only added, subtracted, multiplied,
divided, and did square roots, they were so superior to other methods
that customers were willing to pay the asked price. The manufacturer
of the first handheld calculators used: |
Answer |
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skimming pricing.
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penetration
pricing. |
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price lining.
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odd-even
pricing. |
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demand-backward
pricing. |
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Question
While many people believe shoes are simply something that you wear on
your feet to protect them from the environment, many other people believe
the kind of shoes a person wears makes a statement about them and their
lifestyle. These people are willing to pay $400 or more for a pair of
shoes because to them the price indicates quality. The marketer of these
shoes would use: |
Answer |
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yield management
pricing. |
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target pricing.
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customary
pricing. |
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prestige pricing.
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price lining.
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Question
The prices for all fruit trees sold in Stark Bros. fruit trees and landscaping
catalog end in $.99. Stark Bros. uses: |
Answer |
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odd-even pricing.
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dynamic pricing.
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price lining.
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bundle pricing.
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experience
curve pricing. |
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Question
If you are planning a trip to New York City and want a hotel room overlooking
Central Park, you are likely to pay over $500 per night if you reserve
the room through a hotel, but if you are flexible about the night you
want, you can contact Travelocity and stay in that room for $100. To
what kind of pricing policy is this practice most closely related?
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Answer |
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yield management
pricing |
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target pricing
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customary
pricing |
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prestige
pricing |
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price lining
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Question
The two variations of cost-plus pricing are: |
Answer |
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cost-plus percentage-of-cost
pricing and cost-plus fixed-fee pricing. |
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cost-plus
ROI pricing and cost-minus markdown pricing. |
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target return
on sales pricing and target return on investment pricing. |
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cost-plus
fixed-fee pricing and cost-plus variable-fee pricing. |
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dynamic pricing
and one-price pricing.
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Question
Which of the following statements about cost-oriented approaches is
true? |
Answer |
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These methods
focus on the demand side of the pricing problem and involve stimulating
demand and decreasing revenue. |
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These methods focus
on the supply side of the pricing problem and involve considerations
of production and marketing expenses. |
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Target return
on investment is an example of a cost-based method. |
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Experience
curve pricing is simple to use because costs predictably decrease by
25 percent with each doubling of production. |
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Cost-oriented
approaches are subcategories of competition-based methods so revenues
are a critical factor.
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Question
Imagine that the owner of Lewis Edibles, Inc., the manufacturer of Tongue
Tinglin' barbecue sauce has sold on average 1,000 jars for the last
five years. The company's costs over the same period of time have averaged
$4,000. If the company earns a 20 percent return on sales, what is the
price of a jar of barbecue sauce? |
Answer |
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$2.00
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$2.50
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$4.00
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$5.00
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$10.00
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Question
A manufacturer estimates that consumers will accept a price of $75 for
a handbag. If the manufacturer expects to offer trade discounts of 35/15/5
to retailers, wholesalers, and agents, what price will the manufacturer
receive for the handbag? |
Answer |
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$26.25
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$33.75
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$39.37
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$41.25
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$63.25
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Question
When Ruth makes a purchase on www.ebay.com, she is responsible for paying all
shipping costs for the purchased item. In fact, once the item is shipped,
she owns it and should purchase insurance if it is likely to get broken
while in transit. This shipping arrangement is most closely related
to: |
Answer |
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basing-point
pricing. |
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FOB origin pricing.
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functional
pricing. |
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quantity
pricing. |
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geographic
pricing. |
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Question
A company placing an order from the Lab Safety Supply catalog is instructed
to add 6 percent of the total cost of the order to pay shipping. Which
method of shipping does this catalog supplier use? |
Answer |
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single-zone
pricing |
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flexible-price
pricing |
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FOB origin
pricing |
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uniform delivered
pricing |
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basing-point
pricing |
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