MKTG 2500 QUIZZES QUESTIONS WITH VERIFIED
ANSWERS
Lovely Skin is establishing a pricing strategy for a new moisturizer. The total cost to
produce each unit is $3.50. The company has decided to add a $1.50 markup, so the
unit price to distributors will be $5. Lovely Skin is using a ________ approach to price
the new moisturizer. - Answers - cost-plus
A ________ pricing strategy for an offering begins with an assessment of customer
needs and perceptions. Then a target price is set based on customer perceptions of
worth. - Answers - value-based
Unlike the other marketing mix elements, price plays a minor role in creating customer
value and building customer relationships. true or false - Answers - false
Dynamic pricing is particularly suitable for Internet-based companies like Amazon who
want to be responsive to shoppers' desires and marketplace changes. true or false -
Answers - true
Which of the following statements about break-even analysis is most likely true?
A) It determines how customer-perceived value changes with value-added pricing.
B) It is a tool used to calculate fixed costs.
C) It is used to determine the maximum price that can be set on a product.
D) It is a tool marketers use to examine the relationship between supply and demand.
E) It fails to consider customer value and the relationship between price and demand. -
Answers - E.It fails to consider customer value and the relationship between price and
demand.
If demand hardly changes with a small change in price, the demand is ________. -
Answers - inelastic
Establishing prices for razor blades that must be used with a razor blade system is
known as ________ pricing. - Answers - captive-product
When establishing prices, it's important for a manager to understand that "good value"
is not the same as ________. - Answers - low price
The first Target store opened in 1962. Its initial strategy was to set prices low to attract a
large number of buyers quickly and win a large market share. This is referred to as
________. - Answers - market-penetration pricing
, The first generation Apple iPod was introduced in 2001 and sold for $500. The following
year a mini version was introduced for $250. Apple initially used a ________ strategy to
price their digital music innovation. - Answers - market-skimming
Which of the following sets the upper limit for a product's pricing?
A) profits
B) product costs
C) consumer perceptions of value
D) elements of the product mix
E) competition - Answers - c. consumer perceptions of value
________ pricing involves setting prices based on the costs for producing, distributing,
and selling the product plus a fair rate of return for the company's efforts and risks. -
Answers - cost-based
Salon Du Jour offers special combination packages at a reduced price. Separately, a
haircut is $30 and a conditioning treatment is $35. But the combo price is $50. This is
referred to as ________ pricing. - Answers - product bundle
Some companies deemphasize price and use other marketing mix tools to create non-
price positions in the marketplace. true or false - Answers - true
Which of the following is true of an intensive distribution strategy? - Answers - It strives
to make products available where and when consumers want them.
Introducing intermediaries into a distribution chain increases the number of direct
channel transactions between a manufacturer and its customers. true or false - Answers
- False
Victoria's Closet, a manufacturer of bohemian-style clothing and accessories, sells its
products through its online Web site, a catalogue, and specialty boutiques that target
women.Which kind of channel arrangement does Victoria's Closet employ to distribute
its products? - Answers - multichannel distribution system
Which of the following is true of a vertical marketing system? - Answers - It has one
channel member owning all the other channel members or has contracts with all other
channel members.
A network composed of the company, suppliers distributors, and, ultimately, customers
who partner with each other to improve the performance of the entire system in
delivering customer value. - Answers - Value delivery network
Which of the following is true of a conventional distribution channel? - Answers - It has
each channel member acting as a separate business unit trying to maximize its own
profits.
ANSWERS
Lovely Skin is establishing a pricing strategy for a new moisturizer. The total cost to
produce each unit is $3.50. The company has decided to add a $1.50 markup, so the
unit price to distributors will be $5. Lovely Skin is using a ________ approach to price
the new moisturizer. - Answers - cost-plus
A ________ pricing strategy for an offering begins with an assessment of customer
needs and perceptions. Then a target price is set based on customer perceptions of
worth. - Answers - value-based
Unlike the other marketing mix elements, price plays a minor role in creating customer
value and building customer relationships. true or false - Answers - false
Dynamic pricing is particularly suitable for Internet-based companies like Amazon who
want to be responsive to shoppers' desires and marketplace changes. true or false -
Answers - true
Which of the following statements about break-even analysis is most likely true?
A) It determines how customer-perceived value changes with value-added pricing.
B) It is a tool used to calculate fixed costs.
C) It is used to determine the maximum price that can be set on a product.
D) It is a tool marketers use to examine the relationship between supply and demand.
E) It fails to consider customer value and the relationship between price and demand. -
Answers - E.It fails to consider customer value and the relationship between price and
demand.
If demand hardly changes with a small change in price, the demand is ________. -
Answers - inelastic
Establishing prices for razor blades that must be used with a razor blade system is
known as ________ pricing. - Answers - captive-product
When establishing prices, it's important for a manager to understand that "good value"
is not the same as ________. - Answers - low price
The first Target store opened in 1962. Its initial strategy was to set prices low to attract a
large number of buyers quickly and win a large market share. This is referred to as
________. - Answers - market-penetration pricing
, The first generation Apple iPod was introduced in 2001 and sold for $500. The following
year a mini version was introduced for $250. Apple initially used a ________ strategy to
price their digital music innovation. - Answers - market-skimming
Which of the following sets the upper limit for a product's pricing?
A) profits
B) product costs
C) consumer perceptions of value
D) elements of the product mix
E) competition - Answers - c. consumer perceptions of value
________ pricing involves setting prices based on the costs for producing, distributing,
and selling the product plus a fair rate of return for the company's efforts and risks. -
Answers - cost-based
Salon Du Jour offers special combination packages at a reduced price. Separately, a
haircut is $30 and a conditioning treatment is $35. But the combo price is $50. This is
referred to as ________ pricing. - Answers - product bundle
Some companies deemphasize price and use other marketing mix tools to create non-
price positions in the marketplace. true or false - Answers - true
Which of the following is true of an intensive distribution strategy? - Answers - It strives
to make products available where and when consumers want them.
Introducing intermediaries into a distribution chain increases the number of direct
channel transactions between a manufacturer and its customers. true or false - Answers
- False
Victoria's Closet, a manufacturer of bohemian-style clothing and accessories, sells its
products through its online Web site, a catalogue, and specialty boutiques that target
women.Which kind of channel arrangement does Victoria's Closet employ to distribute
its products? - Answers - multichannel distribution system
Which of the following is true of a vertical marketing system? - Answers - It has one
channel member owning all the other channel members or has contracts with all other
channel members.
A network composed of the company, suppliers distributors, and, ultimately, customers
who partner with each other to improve the performance of the entire system in
delivering customer value. - Answers - Value delivery network
Which of the following is true of a conventional distribution channel? - Answers - It has
each channel member acting as a separate business unit trying to maximize its own
profits.
