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Pricing in Marketing

Description

This is a Unit 4 test related to pricing effects on the Marketing Mix.
Kathleen Keller
Quiz by Kathleen Keller, updated more than 1 year ago
Kathleen Keller
Created by Kathleen Keller over 8 years ago
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Resource summary

Question 1

Question
How does technology help businesses when it enables them to obtain and analyze vast amounts of information that impact the pricing function?
Answer
  • By generating profit-and-loss statements
  • By deciding how much to spend on advertising
  • By calculating the cost of hiring more employees
  • By determining the best time to adjust prices

Question 2

Question
What might happen if a business's customers feel that they are not getting the most value for their money?
Answer
  • Sales remain the same.
  • Sales increase.
  • Customers spend money elsewhere.
  • Customers purchase more.

Question 3

Question
What pricing tactic might be considered questionable by some businesses?
Answer
  • Matching the prices of a competitor
  • Developing a complex pricing structure
  • Marking up prices to earn a profit
  • Providing a reference price

Question 4

Question
Which of the following factors should businesses consider when establishing a product's selling price?
Answer
  • Economic conditions
  • Unfair sales laws
  • Pricing agreements
  • Trade practices

Question 5

Question
What is an example of an unethical pricing practice?
Answer
  • A company prices its products low in an attempt to drive its competitors out of business.
  • A business increases its prices when the cost of the materials to make the products increases.
  • A firm sets a business objective to increase its profit margins over the next five years.
  • A business prices a new product line to reflect high quality and status.

Question 6

Question
The Standard Oil Company's price-fixing tactics and monopolistic control over oil refining and distribution in the late 1800's was a major contributing factor in the enactment of which piece of legislation?
Answer
  • Sherman Antitrust Act
  • Clayton Act
  • Robinson-Patman Act
  • Federal Trade Commission Act

Question 7

Question
Which of the following is an example of an ethical issue as it relates to predatory pricing?
Answer
  • An international book publisher sells similar products to similar customers at different prices.
  • A tire producer introduces a new item to its product line and sets the initial price very low.
  • A salesperson encourages a customer to purchase an extended vehicle warranty for a new car.
  • A local ice-cream shop prices menu items below cost in an effort to eliminate its competition.

Question 8

Question
What is the advantage to a business of using bar-code pricing?
Answer
  • Easier for customers to read
  • Reduces required business security
  • Easier to change prices
  • Reduces number of employees needed for sales

Question 9

Question
What is an external factor that affects the price that a business charges for its products?
Answer
  • Operating costs
  • Variable expenses
  • Economic conditions
  • Employee benefits

Question 10

Question
Why do some new companies set their selling prices as low as they can?
Answer
  • To eliminate all possible competition
  • To get market share as fast as possible
  • To earn a high return on investment
  • To quickly make a large profit

Question 11

Question
Companies A, B, and C sell similar products. Together, they recently decided to sell their products for the same price. In what unethical activity are the businesses engaging?
Answer
  • Bait-and-Switch
  • Price Fixing
  • Loss-leader Pricing
  • Gray Markets

Question 12

Question
Charging premium prices for lumber to hurricane victims because supply is limited is
Answer
  • unethical and illegal.
  • unethical and legal.
  • ethical and legal.
  • ethical and illegal.

Question 13

Question
A business charges a small company a higher price for a product than it charges a large company for the same product. What does this represent?
Answer
  • Price Discrimination
  • Controlled Pricing
  • Price Competition
  • Regulated Pricing

Question 14

Question
Wal-Mart and Sears attract two different types of customers because of their pricing strategies. They have established their prices based on __________ decisions.
Answer
  • promotional
  • customer
  • place
  • profit

Question 15

Question
What would be the most appropriate pricing strategy for a business in a small town where unemployment has skyrocketed and the economy is in a downturn?
Answer
  • Below-cost pricing
  • High-level pricing
  • Odd-cents pricing
  • Flexible pricing

Question 16

Question
One way that many businesses use technology to reduce the costs associated with marking prices on products is by using
Answer
  • electronic scanning devices.
  • automated inventory systems.
  • preprinted gummed labels.
  • computer-generated tags.

Question 17

Question
Technology allows manufacturers to pre-print product packaging with Universal Product Codes (UPCs) which contain __________ information.
Answer
  • pricing
  • sampling
  • operating
  • selling

Question 18

Question
What costs do businesses usually include in the price of their products?
Answer
  • Regulations
  • Inflation
  • Transportation
  • Orientation
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