Lorisse Bazley
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Understanding costs and developing pricing strategy

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Lorisse Bazley
Created by Lorisse Bazley over 6 years ago
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Services Marketing - chapter 6

Question 1 of 10

1

A cost management system that provides a structured way of thinking about the relationship between activities and the resources they consume is known as:

Select one of the following:

  • activity-based costing

  • volume-based costing

  • product-based costing

  • yield-based costing

Explanation

Question 2 of 10

1

Services often invite performance and pricing abuses for which of the following reasons?

Select one of the following:

  • Customers may not be present when the work is being performed.

  • Customers may not have the technical skills necessary to evaluate performance.

  • Quality and benefits may be difficult to evaluate even after delivery

  • Customers may not be able to assess the amount, if any, of work done.

  • All of the above

Explanation

Question 3 of 10

1

In some cases, __________ demand might be more important than achieving maximum __________, as long as basic __________ requirements are met.

Select one of the following:

  • maximising; profit; profit

  • basic; profit; needs

  • actualising; profit; profit

  • maximising; exposure; profit

Explanation

Question 4 of 10

1

Which of the following is NOT a revenue or profit objective?

Select one of the following:

  • Vary prices to maximise revenue from a fixed capacity

  • Cover all costs, including overhead

  • Cover costs of providing a particular service

  • Maximise demand

Explanation

Question 5 of 10

1

A customer who perceives high levels of __________ risk worries about how comfortable and secure they will feel with a particular service provider.

Select one of the following:

  • temporal

  • performance

  • psychological

  • social

Explanation

Question 6 of 10

1

When price is set and used with the aim of maximising sales, cash flow and/or profits, we may say that the pricing objective is primarily:

Select one of the following:

  • operations-oriented

  • patronage-oriented

  • revenue-oriented

  • production-oriented

Explanation

Question 7 of 10

1

Which of the following does an effective pricing strategy do?

Select one of the following:

  • Keeps prices below costs

  • Makes service pricing difficult to understand

  • Fulfils the promise of the value proposition

  • Eliminates non-monetary costs

Explanation

Question 8 of 10

1

Marketing’s task in helping maximise ARGE involves all of the following except:

Select one of the following:

  • providing the sales force with specific sales target on specific dates for each segment

  • providing guidelines for what prices to charge each segment at specific points in time

  • monitoring price over time

  • forecasting the volumes of business that might be obtained from each segment at specific price levels

Explanation

Question 9 of 10

1

A customer who perceives high levels of _________ worries about when and how she will be able to find, evaluate and select a service provider.

Select one of the following:

  • time and effort cost

  • performance risk

  • psychological risk

  • financial cost

Explanation

Question 10 of 10

1

A service organisation may take into consideration all of the following costs when using the cost-based pricing, except:

Select one of the following:

  • semi-variable costs

  • marginal costs

  • opportunity costs

  • variable costs

Explanation

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