MKTG 2500 quizzes (100% Errorless)

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. correct 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. correct 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 correct 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 correct 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. correct 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 ________. correct answers inelastic Establishing prices for razor blades that must be used with a razor blade system is known as ________ pricing. correct answers captive-product When establishing prices, it's important for a manager to understand that "good value" is not the same as ________. correct 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 ________. correct 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. correct 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