Group 12 Chapter 15 Quiz
1. Cost-based pricing methods determine the final price to charge by starting with the
a. Expected profits
b. Costs
c. Risk
d. Past prices
e. Market research
2. Firms using competition-based pricing method base their prices on
f. Competitors
g. Partners
h. Expected Profits
i. Average costs of production
j. Assumed Risk
3. Which strategy for price setting focuses on the overall value of the product offering as
perceived by the customer?
a. Cost-based
b. Competition-based
c. Value-based
d. Product-based
e. Risk-based
4. Which is the form of discounts that retailers take off on the initial selling price of the product or
service?
a. Markdowns
b. Coupons
c. Rebates
d. Leasing
e. Price Bundling
5. All of these are methods firms use to set their prices EXCEPT.
a. Cost-based pricing
b. Value-based pricing
c. Improvement-value-based pricing
d. competition-based pricing
e. risk-analysis based pricing
6. A strategy which relies on the promotion of sales, during which prices are temporarily
reduced to encourage purchases is called.
a. Everyday low pricing
b. High/Low Pricing
c. Market Penetration Pricing
d. Price Skimming
e. Price Fixing
7. When using a market penetration strategy, as sales continue to grow, the costs continue to
drop, allowing even further reductions in the price. This is due to
A.markdowns.
B.price lining.
C.seasonal discounts.
D.improvement value.
E.experience curve effects.
8. People who are considered “innovators” in that they are willing to pay a higher price to obtain
a new product or service, would likely not object to a _______ strategy.
A.price lining
B.price skimming
C.predatory pricing
D.price fixing
E.bait-and-switch pricing
9. Under cost based methods, costs are assessed at the _____ level.
a. Unit
b. Batch
c. Company
d. Global
10. Premium costing is found under which method?
a. competition based
b. Value based
c. Cost based
d.customer based
11. ______ occurs when competitors that produce and sell competing products or services
collude, or work together, to control prices, effectively taking price out of the decision process
for consumers
A. Price Fixing
B. Horizontal Price Fixing
C. Vertical Price Fixing
D. Diagonal Price Fixing
12. Which of the following is a new product pricing strategy?
A. Markdowns
B. Price Skimming
C. Seasonal Discounts
D. Coupons
13. When a new product appeals to those segments of consumers who are willing to pay a
premium price to have an innovation first, marketers should use a _______ pricing strategy.
A. Price Skimming
B. Reference Point
C. Market Penetration
D. Technology Advances
14. Which of the following is not a pricing tactic aimed at consumers?
A. Price Lining
B. Cumulative Discounting
C. Bundling
D. Coupons
15. The price against which buyers compare the actual selling price of the product is the
a. critical price
b. promotion price
c. MSRP
d. reference price
e. sales price
16. Price skimming is particularly common in
a. technology markets
b. securities
c. fast food
d. wholesale
e. stocks and bonds
17. Which of the following is a long term approach to setting prices
a. Pricing strategy
b. Pricing tactics
c. Pricing plan
d. Pricing goal
e. Pricing specification
18. Which of the following offer short term methods to focus on the five Cs
a. Pricing strategy
b. Pricing tactics
c. Pricing plan
d. Pricing goal
e. Pricing specification
19. Which of the following is not one of the five Cs
a. Company objectives
b. Costs
c. Customers
d. Competition
e. Creating value
20. Markdowns are an integral part of which pricing strategy
a. Everyday Low Pricing
b. High/Low Pricing
c. Reference Pricing
d. Market Pricing
e. Penetration Pricing
Answers:
1. B
2. A
3. C
4. A
5. D
6. B
7. A
8. B
9. A
10. A
11. B
12. B
13. A
14. B
15. D
16. A
17. A
18. B
19. E
20. B