Transcript Document
Welcome to... A Game of X’s and O’s 1 2 4 7 3 5 8 6 9 Scoreboard 1 2 3 X 4 5 6 O 7 Click Here if X Wins Click Here if O Wins 8 9 1 One advantage of non-price competition is that a. a firm can react quickly to competitive efforts. b. market share becomes less important. c. a firm can build customer loyalty. d. marketing efforts are completely eliminated e. pricing is no longer a factor. 1 Home c. a firm can build customer loyalty. (p. 243) 2 Which of the following is most likely to have an inelastic demand curve? a. automobile b. vacation c. nonelective surgery d. recreational vehicle e. computer 2 Home c. nonelective surgery (pp. 245-246) 3 Running a big sale in order to generate enough cash flow to pay creditors is typical in a situation in which a firm’s primary pricing objective is a. status quo b. profit c. survival d. market share e. recovery 3 Home c. survival (p. 266) 4 The pricing of Clinique makeup, considerably higher than brand such as Cover Girl, Revlon, and Maybelline, is used to communicate _______________, which is the company’s primary pricing objective. a. market share b. product quality c. status quo d. profitability e. cash flow. 4 Home b. product quality (p. 268) 5 If PepsiCo sets its six-pack price at $1.25 to match the price charged by Coca-cola, Pepsi is using which of the following pricing methods? a. demand-based b. cost-based c. reference pricing d. competition based e. price leader 5 Home d. competition based (p. 272) 6 True or False: Differential pricing means different buyers pay different prices for the same quality and quantity of product. 6 True: Differential pricing can occur in several ways: it can be negotiated; it can involve secondary markets, or periodic or random discounting. Pages 274-275 Home 7 True or False: Price skimming is designed to yield maximum unit sales volume. 7 False: Price skimming, charging the highest possible price, is designed to maximize initial cash flow and cover development costs for new products. Page 274 Home 8 True or False: Captive pricing, premium pricing, bait pricing, and price lining are all strategies aimed at maximizing the profits of an entire product line rather than an individual product. 8 Home True: A thorough answer to this question should explain how each of the above strategies maximizes overall profit of the line. Page 276 9 True or false: . A psychological price is designed to encourage purchases on the basis rational response rather than on the basis of emotional reactions. 9 Home False: psychological price strategies such as reference pricing, bundle pricing, multiple-unit pricing, edlp, odd-even pricing, customary pricing and prestige pricing try to influence the perception of price. Pages 277-278