MKT 475 Week 8 Quiz – Strayer
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Quiz
7 Chapter 11 and 12
Chapter
11
Pricing Strategy
True/False
Questions
1. Price
strategy is always related to competition whether firms use a higher, lower, or
equal price.
323
2. Both revenues and costs need to be taken into
account in selecting pricing strategies.
323
3.
Lowering prices generally eliminates potential price wars.
324
4.
The second step in selecting a pricing strategy is analyzing the pricing
situation.
324
5. The
core issue in pricing is finding out what value requirements (benefits-costs)
the buyer places on the product or brand.
327
6. The
underlying logic of economic value modeling (EVM) is that using the
price/benefit ratio is a more realistic view of value than "dollar worth
of benefits minus price."
328
7.
Customer value mapping estimates are based on the differentiated benefits that
a customer receives from a product.
328
8. Competitive
bidding is an example of demand-oriented approach of pricing.
340
9. Reverse
auction pricing involves sellers bidding for organizational buyers’ purchases.
340
10.
The competitor is the frame of reference for demand-oriented pricing methods.
340
Multiple
Choice Questions
11.
Which of the following distribution approaches is most likely to call for more
competitive pricing?
A.
Exclusive
B.
Selective
C.
Intensive
D.
Narrow
321
322
12.
Price cuts in economic downturns are primarily aimed at:
A.
increasing short-term profits.
B.
defending a firm’s position vigorously.
C.
compensating for low quality products.
D.
capturing market share.
323
13.
Which of the following is the first step in selecting a pricing strategy?
A.
Setting pricing objectives
B.
Analyzing the pricing situation
C.
Selecting pricing strategy
D.
Determining specific prices and policies
323
14.
Which of the following is the final step in selecting a pricing strategy?
A.
Setting pricing objectives
B.
Determining specific prices and policies
C.
Selecting pricing strategy
D.
Analyzing the pricing situation
323
15.
_____ is the percentage change in the quantity sold of a brand when the price
changes, divided by the percentage change in price.
A.
Price distribution
B.
Price band
C.
Price point
D.
Price elasticity
327
16.
_____ estimates value as the perceived quality buyers obtain per unit of price.
A.
Customer value mapping
B.
Customer equity
C.
User lifetime value
D.
Customer value proposition
327
328
17.
Value using _____ consists of the financial savings and gains provided to
customers due to purchase of the firm’s brand instead of competitors’ brands.
A.
customer value mapping
B.
economic value modeling
C.
user lifetime value
D.
customer value proposition
328
18.
Which of the following is the first step in cost analysis for pricing
decisions?
A.
Estimating how cost varies with the volume of sales
B.
Analyzing the cost competitive advantage of the product
C.
Determining the components of the cost of the product
D.
Estimating how much control management has over costs
330
19.
_____ indicates whether costs and prices for various products decline by a
given amount each time the number of units produced doubles.
A.
Economic value modeling
B.
Activity-based costing
C.
Customer value mapping
D.
Learning-curve analysis
331
20.
A high-active pricing strategy:
A.
values superiority.
B.
emphasizes nonprice competitive factors.
C.
offers discounts.
D.
avoids price comparisons.
336
21.
Which of the following is true of high-passive strategy pricing?
A.
It is used when competition for the market target is very high.
B.
It emphasizes nonprice competitive factors.
C.
It is primarily used by discount retailers.
D.
It is used by producers whose brands are not familiar to the market.
337
22.
A low-active pricing strategy:
A.
emphasizes nonprice competitive factors.
B.
is mainly used to gain margins in small market targets.
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