51) ________ that influence pricing decisions include the nature of the market and other environmental factors.
A) Internal factors
B) Value factors
C) External factors
D) Target factors
E) Domestic factors
Answer: C
Diff: 2 Page Ref: 300
Skill: Concept
Objective: 10-3
52) In order to form a consistent and effective integrated marketing program, price decisions should be coordinated with each of the following EXCEPT ________.
A) product design
B) distribution
C) competitors' prices
D) promotion decisions
E) marketing objectives
Answer: C
Diff: 2 Page Ref: 300
Skill: Concept
Objective: 10-3
53) With target costing, marketers will first ________ and then ________.
A) build the marketing mix; identify the target market
B) identify the marketing mix; determine product cost
C) design the product; determine its cost
D) use skimming pricing; penetrating pricing
E) determine a selling price; target costs to ensure that the price is met
Answer: E
Diff: 2 Page Ref: 300
Skill: Concept
Objective: 10-3
54) A company that wants to emphasize the premium quality of its product and enhance the product's allure would be most likely to position its product on ________.
A) high prices
B) nonprice qualities
C) low prices
D) value prices
E) target costing
Answer: A
Diff: 2 Page Ref: 301
Skill: Concept
Objective: 10-3
55) Price setting is usually determined by ________ in small companies.
A) top management
B) marketing departments
C) sales departments
D) divisional managers
E) cross-functional teams
Answer: A
Diff: 2 Page Ref: 301
Skill: Concept
Objective: 10-3
56) Price setting is usually determined by ________ in large companies.
A) top management
B) divisional managers
C) product line managers
D) pricing departments
E) both B and C
Answer: E
Diff: 2 Page Ref: 301
Skill: Concept
Objective: 10-3
57) In industrial markets, ________ typically has the final say in setting the pricing objectives and policies of a company.
A) the sales manager
B) top management
C) the production manager
D) the finance manager
E) the sales staff
Answer: B
Diff: 2 Page Ref: 301
Skill: Concept
Objective: 10-3
58) In industries in which pricing is a key factor, ________ often set the best prices or help others in setting them.
A) sales managers
B) salespeople
C) production managers
D) finance managers
E) pricing departments
Answer: E
Diff: 2 Page Ref: 301
Skill: Concept
Objective: 10-3
59) Under ________, the market consists of many buyers and sellers trading in a uniform commodity such as wheat, copper, or financial securities.
A) pure competition
B) monopolistic competition
C) oligopolistic competition
D) a pure monopoly
E) anti-trust agreements
Answer: A
Diff: 2 Page Ref: 301
Skill: Concept
Objective: 10-3
60) Under ________, the market consists of many buyers and sellers who trade over a range of prices rather than a single market price.
A) pure competition
B) monopolistic competition
C) oligopolistic competition
D) a pure monopoly
E) socialism
Answer: B
Diff: 2 Page Ref: 301
Skill: Concept
Objective: 10-3
61) Firms are less affected by competitors' pricing strategies under ________ than under ________.
A) monopolistic competition; oligopolistic competition
B) pure competition; monopolistic competition
C) oligopolistic competition; pure competition
D) oligopolistic competition; monopolistic competition
E) pure competition; a pure monopoly
Answer: A
Diff: 3 Page Ref: 302
Skill: Concept
Objective: 10-3
62) Under ________, the market consists of one seller.
A) a pure monopoly
B) monopolistic competition
C) oligopolistic competition
D) pure competition
E) capitalism
Answer: A
Diff: 2 Page Ref: 302
Skill: Concept
Objective: 10-3
63) The relationship between the price charged and the resulting demand level can be shown as the ________.
A) demand curve
B) variable cost
C) target cost
D) break-even pricing
E) experience curve
Answer: A
Diff: 1 Page Ref: 302
Skill: Concept
Objective: 10-3
64) Which of the following is true about the demand curve?
A) It is used to illustrate the effect of price on the quantity supplied.
B) It is always graphically depicted by a straight line.
C) It shows the quantity of product customers will buy in a market during a period of time even if other factors change.
D) It usually slopes upward and to the right.
E) It shows the relationship between product demand and product price.
Answer: E
Diff: 3 Page Ref: 302
Skill: Concept
Objective: 10-3
65) Ascot Tires has decided to decrease its prices. The company can expect that ________ for its product will increase.
A) cost-plus pricing
B) value-based pricing
C) demand
D) the experience curve
E) competition
Answer: C
Diff: 2 Page Ref: 302
Skill: Concept
Objective: 10-3
66) ________ describes how responsive demand will be to a change in price.
A) Price elasticity
B) Break-even pricing
C) The demand curve
D) Target costing
E) Supply
Answer: A
Diff: 1 Page Ref: 303
Skill: Concept
Objective: 10-3
67) If demand hardly changes with a small change in price, we say the demand is ________.
A) variable
B) inelastic
C) value-based
D) at break-even pricing
E) market penetrating
Answer: B
Diff: 2 Page Ref: 302-303
Skill: Concept
Objective: 10-3
68) If demand changes greatly with a small change in price, we say the demand is ________.
A) variable
B) inelastic
C) value-based
D) elastic
E) fixed
Answer: D
Diff: 2 Page Ref: 303
Skill: Concept
Objective: 10-3
69) Price elasticity of demand is ________ divided by ________.
A) percent change in quantity demanded; percent change in price
B) demand; price
C) percent change in price; percent change in quantity demanded
D) the going price; the asking price
E) retail value; list price
Answer: A
Diff: 2 Page Ref: 303
Skill: Concept
Objective: 10-3
70) Buyers are less price sensitive in all of the following situations EXCEPT ________.
A) when the product they are buying is unique
B) when the product they are buying is high in quality
C) when substitute products are hard to find
D) when the total expenditure for a product is high relative to their income
E) when the product is exclusive
Answer: D
Diff: 2 Page Ref: 303
Skill: Concept
Objective: 10-3
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