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Exam 20: Setting Prices

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Question 91

Multiple Choice

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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) keeping the status quo.
B) profit.
C) survival.
D) market share.
E) recovery.

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Question 92

Multiple Choice

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The pricing strategy that assumes that demand is relatively inelastic over certain price ranges is called

A) price lining.
B) odd-even pricing.
C) price skimming.
D) prestige pricing.
E) customary pricing.

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Question 93

Multiple Choice

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Most pricing objectives based on ____ are achieved by trial and error because not all cost and revenue data are available when prices are set.

Sony management decided to use skimming as a pricing strategy for its newest line of high-definition television (HDTV) sets. It should be aware that this strategy does not

When establishing prices, a marketer's first step is to

After selecting a pricing strategy, what is the next step in the establishment of prices?

All of the following are pricing strategies used by companies establishing prices of multiple products within a product line except

One pitfall of cost-plus pricing for the buyer is that the seller may increase costs to establish a larger profit base.

Lexmark sells some of its color printers for about $100, but the refill cartridges cost over $30 each. Lexmark's pricing strategy would be best labeled as

Demand-based pricing strategies are easy to use.

All for Fun is a retail store that offers a variety of board games, magic cards, and other collectible items and caters to teens and adults who enjoy strategy-based games. The store has over 20,000 magic cards and utilizes a sophisticated computer system to identify the value of each card. All for Fun determines the rarity of a given card and adjusts prices according to how much money customers are likely to pay for a particular card. Cards that are in limited production or considered "rare" are more expensive than cards that are widely available. Thus, the price for a single magic card might vary between $25 and $50 or more per card depending on the market. What type of pricing is All for Fun utilizing?

During July and August, Lakewood Links Golf Course, located in South Carolina, offers weekday rates of $13 for a round of golf with a cart. During the rest of the year, the weekday rates are between $25 and $35. This is an example of the use of

Breyer's produces a variety of ice cream flavors and lines of varying qualities. The higher quality ice cream varieties are priced higher than the basic ones. Breyer's is using ____ to price its ice cream.

Wet Seal, a retailer of swimwear, employs a commonly used cost-based pricing method called

If a business decides to reduce its prices once in a while on an unsystematic basis, it is using

Bundle pricing may be perceived to be of value by customers because

The use of price skimming discourages competitors from entering a market.

Under Armour is establishing a ______ pricing objective to maintain or increase its product's sales in relation to total industry sales.

What are some issues to consider when determining a specific price?

The use of market share as a pricing objective oversimplifies the value of price in contributing to profits.