Gizem Atav COB300D Exam 2 Vocab Questions with Verified Answers | Latest Update Questions with
Correct Answers
Question 1:
cost-based pricing
methods
Answer:
determine the final price to charge by starting with
the cost
Question 2:
competition-based pricing method
Answer:
set their prices to reflect the way they want
consumers to interpret their own prices, relative to competitors' offerings
Question 3:
value-based pricing methods
Answer:
approaches to setting prices that focus on the overall
value of the product offering as perceived by the consumer
Question 4:
improvement value
Answer:
represents an estimate of how much more (or less) consumers are willing to pay for a product relative
to
other comparable products
Question 5:
cost-of-ownership method
Answer:
consumers may be willing to spend more initially if,
over the lifetime, the product will eventually cost less to own
Question 6:
pricing strategy
Answer:
A long-term approach to setting prices broadly in an integrative effort based on the five C's (company
objectives, costs, customers, competition, channel members)
, Question 7:
everyday low pricing
Answer:
companies stress the continuity of their retail prices at a level somewhere between the regular, nonsale
price and the deep-discount sale prices their competitors may offer
Question 8:
high-low pricing strategy
Answer:
relies on the promotion of sales, during which prices are temporarily reduced to encourage purchases
Question 9:
penetration pricing
Answer:
setting a low initial price on a new product to appeal immediately to the mass market
Question 10:
experience curve effect
Answer:
refers to the drop in unit cost as the accumulated volume sold increases; as sales continue to grow, the
costs continue to drop, allowing even further reductions in the price
Question 11:
price skimming
Answer:
a pricing policy whereby a firm charges a high introductory price, often coupled with heavy promotion,
followed by a gradual reduction of price to capture more price-sensitive segments
Question 12:
pricing tactics
Answer:
Short-term methods, in contrast to long-term pricing strategies, used to focus on company objectives,
costs, customers, competition, or channel members; can be responses to competitive threats (e.g.,
lowering price temporarily to meet a competitor's price reduction) or broadly accepted methods of
calculating a final price for the customer that is short term in nature. Support pricing strategies
Question 13:
markdowns
Answer:
reductions retailers take on the initial selling price of the product or service; an integral component to
high-lower pricing strategy
Correct Answers
Question 1:
cost-based pricing
methods
Answer:
determine the final price to charge by starting with
the cost
Question 2:
competition-based pricing method
Answer:
set their prices to reflect the way they want
consumers to interpret their own prices, relative to competitors' offerings
Question 3:
value-based pricing methods
Answer:
approaches to setting prices that focus on the overall
value of the product offering as perceived by the consumer
Question 4:
improvement value
Answer:
represents an estimate of how much more (or less) consumers are willing to pay for a product relative
to
other comparable products
Question 5:
cost-of-ownership method
Answer:
consumers may be willing to spend more initially if,
over the lifetime, the product will eventually cost less to own
Question 6:
pricing strategy
Answer:
A long-term approach to setting prices broadly in an integrative effort based on the five C's (company
objectives, costs, customers, competition, channel members)
, Question 7:
everyday low pricing
Answer:
companies stress the continuity of their retail prices at a level somewhere between the regular, nonsale
price and the deep-discount sale prices their competitors may offer
Question 8:
high-low pricing strategy
Answer:
relies on the promotion of sales, during which prices are temporarily reduced to encourage purchases
Question 9:
penetration pricing
Answer:
setting a low initial price on a new product to appeal immediately to the mass market
Question 10:
experience curve effect
Answer:
refers to the drop in unit cost as the accumulated volume sold increases; as sales continue to grow, the
costs continue to drop, allowing even further reductions in the price
Question 11:
price skimming
Answer:
a pricing policy whereby a firm charges a high introductory price, often coupled with heavy promotion,
followed by a gradual reduction of price to capture more price-sensitive segments
Question 12:
pricing tactics
Answer:
Short-term methods, in contrast to long-term pricing strategies, used to focus on company objectives,
costs, customers, competition, or channel members; can be responses to competitive threats (e.g.,
lowering price temporarily to meet a competitor's price reduction) or broadly accepted methods of
calculating a final price for the customer that is short term in nature. Support pricing strategies
Question 13:
markdowns
Answer:
reductions retailers take on the initial selling price of the product or service; an integral component to
high-lower pricing strategy
