Market-penetration pricing refers
to the practice of:
a)
setting a high initial price and then penetrating the market with successive
prices for each price sensitive layer.
b)
setting a low initial price to penetrate the market quickly and attract
a large number of buyers to win a large market share.
c)
pricing to attract low volume in many segments so as to gradually penetrate
the market as a whole.
d)
pricing products very high to penetrate deeply and quickly into large
profits for the company.
2.
Companies bringing out an innovative,
patent-protected product face the challenge of setting prices for the first
time. They can choose between two strategies:
a)
good-value and a premium pricing strategy.
b)
market-skimming and market-penetration pricing.
c)
market-competitive and market-loss pricing.
d)
good-value and economy pricing strategy.
3.
The process of setting a high price
for a new product to gain maximum revenues layer by layer from the segments
willing to pay the high price is called:
a)
market-penetration pricing.
b)
market-layer pricing.
c)
market-skimming pricing.
d)
market-saturation pricing.
4.
The strategy for setting a product's
price often has to be changed when the product is part of a(n):
a)
marketing statement.
b)
marketing position.
c)
product mix.
d)
promotion mix.
5.
________________ is setting a price
for by-products in order to make the main product's price more competitive.
a)
Optimal-product pricing
b)
Captive-product pricing
c)
By-product pricing
d)
Product line pricing
6.
Combining several products and
offering them together at a reduced price is called:
a)
product-bundle pricing.
b)
optimal-product pricing.
c)
captive-product pricing.
d)
by-product pricing.
7.
A(n) ________________ is a price
reduction to buyers who pay their bills promptly.
a)
quantity discount
b)
functional discount
c)
cash discount
d)
allowance
8.
Offering discounts by the seller
to marketing channel members who perform certain activities such as selling
or storing are called:
a)
quantity discount.
b)
cash discount.
c)
seasonal discount.
d)
functional discount.
9.
In an attempt to keep production
steady during an entire year, especially for products whose use is for
only part of the year, sellers often use which of the following?
a)
Cash discounts
b)
Quantity discounts
c)
Functional discounts
d)
Seasonal discounts
10.
A(n) ___________________ is promotional
money paid by manufacturers to retailers in return for an agreement to
feature the manufacturer's products in some way.
a)
reference price
b)
allowance
c)
push
d)
bribe
11.
Sellers consider the perception
that price has on the buyer rather than simply the economics involved in
which type of pricing?
a)
Discount pricing
b)
Discriminatory pricing
c)
Psychological pricing
d)
Promotional pricing
12.
Companies often face situations
in which they must initiate price changes or respond to price changes by
competitors. All of the following situations may lead a firm to consider
cutting its price EXCEPT:
a)
excess capacity.
b)
cost inflation.
c)
falling market share.
d)
attempting to dominate a market with a lower-price strategy through
lower costs.
13.
All of the following are conditions
that facilitate competitive reactions to price changes EXCEPT:
a)
the number of firms involved is small.
b)
the product is uniform.
c)
the buyers are well informed.
d)
the product is highly diverse.
14.
FOB-origin pricing occurs when
the company charges the same price plus freight to all customers, regardless
of their location.
a)
True
b)
False
15.
Basing-point pricing tends to discriminate
against customers that are distant.
