BUAD 332 EXAM 3 2026 QUESTIONS WITH ALL
CORRECT ANSWERS VERIFIED
◉ Broadly, what is a price? Answer: Broadly, price is the sum of all
values that consumers exchange for the benefits of having or using
the product or service
◉ Price is not just money, think of price as Answer: sacrifice
◉ Example of price Answer: $88 boots from amazon versus exact
same pair at Dillards for $88 as well.
The price here is wait-time, trying them on, or convenience.
The "lower price" depends on customer value
◉ Internal factors affecting price decisions Answer: Marketing
objectives
Marketing mix strategies
Costs
Organizational considerations
◉ External factors affecting price decisions Answer: Nature of the
market and demand
,Competition
Other environmental factors (economy, government, re-sellers,
social concerns)
◉ In general, factors affection price decisions represent Answer:
either a limitation or "wiggle room"
◉ Marketing objectives affecting pricing decisions Answer: 1.
Survival
2. Current Profit Maximization
3. Market Share Leadership
4. Product Quality Leadership
◉ Survival Answer: Low prices hoping to increase demand
◉ Current Profit Maximization Answer: Choose the price that
produces the maximum current profit
◉ Market Share Leadership Answer: Low as possible prices to
become the market share leader
◉ Product Quality Leadership Answer: High prices to cover higher
performance quality and R&D
,◉ Product Quality Leadership Example Answer: Pharmaceuticals
◉ Fixed costs (overhead) Answer: Costs that don't vary with sales or
production levels
◉ Total costs Answer: Sum of the fixed and variable costs for any
given level of production
◉ Costs determine the... Answer: Floor
◉ Customers determined the... Answer: Ceiling
◉ External factors affecting Pricing decisions Answer: - Markets and
Demand
- Competitors' costs, prices, and offers
- Other external factors: Economic conditions, reseller reactions,
government actions and social concerns
◉ Market and demand factors affecting pricing decisions Answer: -
Pure Competition
- Monopolistic competition
- Oligopolisitic competition
, - Pure Monopoly
◉ Pure Competition Answer: Many buyers and sellers who have
little effect on the price
EX: Farming
◉ Monopolistic Competition Answer: Many buyers and sellers who
trade over a range of prices
EX: Jeans
◉ Oligopolistic Competition Answer: Few sellers who are sensitive
to each other's pricing/marketing strategies
EX: Airlines
◉ Pure Monopoly Answer: Single seller
EX: KUB
◉ Downward sloping demand curve indicates that Answer: As price
gets lower, quantity demanded gets higher.
◉ MBA program example that contradicts a downward sloping
demand curve Answer: UTK was charging $25,000 15 years ago but
then decided that they could raise the price to $45,000.
CORRECT ANSWERS VERIFIED
◉ Broadly, what is a price? Answer: Broadly, price is the sum of all
values that consumers exchange for the benefits of having or using
the product or service
◉ Price is not just money, think of price as Answer: sacrifice
◉ Example of price Answer: $88 boots from amazon versus exact
same pair at Dillards for $88 as well.
The price here is wait-time, trying them on, or convenience.
The "lower price" depends on customer value
◉ Internal factors affecting price decisions Answer: Marketing
objectives
Marketing mix strategies
Costs
Organizational considerations
◉ External factors affecting price decisions Answer: Nature of the
market and demand
,Competition
Other environmental factors (economy, government, re-sellers,
social concerns)
◉ In general, factors affection price decisions represent Answer:
either a limitation or "wiggle room"
◉ Marketing objectives affecting pricing decisions Answer: 1.
Survival
2. Current Profit Maximization
3. Market Share Leadership
4. Product Quality Leadership
◉ Survival Answer: Low prices hoping to increase demand
◉ Current Profit Maximization Answer: Choose the price that
produces the maximum current profit
◉ Market Share Leadership Answer: Low as possible prices to
become the market share leader
◉ Product Quality Leadership Answer: High prices to cover higher
performance quality and R&D
,◉ Product Quality Leadership Example Answer: Pharmaceuticals
◉ Fixed costs (overhead) Answer: Costs that don't vary with sales or
production levels
◉ Total costs Answer: Sum of the fixed and variable costs for any
given level of production
◉ Costs determine the... Answer: Floor
◉ Customers determined the... Answer: Ceiling
◉ External factors affecting Pricing decisions Answer: - Markets and
Demand
- Competitors' costs, prices, and offers
- Other external factors: Economic conditions, reseller reactions,
government actions and social concerns
◉ Market and demand factors affecting pricing decisions Answer: -
Pure Competition
- Monopolistic competition
- Oligopolisitic competition
, - Pure Monopoly
◉ Pure Competition Answer: Many buyers and sellers who have
little effect on the price
EX: Farming
◉ Monopolistic Competition Answer: Many buyers and sellers who
trade over a range of prices
EX: Jeans
◉ Oligopolistic Competition Answer: Few sellers who are sensitive
to each other's pricing/marketing strategies
EX: Airlines
◉ Pure Monopoly Answer: Single seller
EX: KUB
◉ Downward sloping demand curve indicates that Answer: As price
gets lower, quantity demanded gets higher.
◉ MBA program example that contradicts a downward sloping
demand curve Answer: UTK was charging $25,000 15 years ago but
then decided that they could raise the price to $45,000.
