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Marketing Final Exam

Aacsb reflective msc blooms comprehension 22 break

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Unformatted text preview: ximized its profits when its marginal revenue equals its marginal cost. PTS: 1 REF: 311 Thinking KEY: CB&E Model Pricing OBJ: 19-5 TOP: AACSB Reflective MSC: BLOOMS Comprehension 22. Break-even analysis determines what sales volume must be reached before total revenue equals total costs. ANS: T PTS: 1 TOP: AACSB Reflective Thinking MSC: BLOOMS Knowledge REF: 311 OBJ: 19-5 KEY: CB&E Model Pricing 23. As products enter the growth stage of the product life cycle, prices generally begin to stabilize. ANS: T PTS: 1 TOP: AACSB Reflective Thinking MSC: BLOOMS Comprehension REF: 313 OBJ: 19-6 KEY: CB&E Model Pricing 24. The manufacturers that remain in the market toward the end of the maturity stage typically offer similar prices. ANS: T PTS: 1 TOP: AACSB Reflective Thinking MSC: BLOOMS Comprehension REF: 313 OBJ: 19-6 KEY: CB&E Model Pricing 25. Prices may actually rise for a product in the decline stage of the product life cycle. ANS: T When only one firm is left in the market, prices begin to stabilize, but they may eventually rise dramatically if the product survives and moves into the specialty goods category, as horse-drawn carriages and vinyl records have. PTS: 1 REF: 313 Thinking KEY: CB&E Model Pricing OBJ: 19-6 TOP: AACSB Reflective MSC: BLOOMS Comprehension 26. Adequate distribution for a new product is often obtained by reducing the size of the profit margin for its resellers. ANS: F Adequate distribution for a new product is often obtained by offering a larger-than-usual profit margin to its distributors. PTS: 1 REF: 314 Thinking KEY: CB&E Model Pricing OBJ: 19-6 TOP: AACSB Reflective MSC: BLOOMS Comprehension 27. Price should not be used as a promotional tool. ANS: F Price is often used as a promotional tool to increase consumer interest. PTS: 1 REF: 315 Thinking KEY: CB&E Model Pricing OBJ: 19-6 TOP: AACSB Reflective MSC: BLOOMS Comprehension 28. One strategy to get adequate distribution for a new product is to offer dealers a large trade allowance to help offset the costs of promotion. ANS: T PTS: 1 TOP: AACSB Reflective Thinking MSC: BLOOMS Comprehension REF: 314 OBJ: 19-6 KEY: CB&E Model Pricing 29. High purchase prices may create feelings of pleasure and excitement in consumers. ANS: T PTS: 1 TOP: AACSB Reflective Thinking MSC: BLOOMS Comprehension REF: 316 OBJ: 19-6 KEY: CB&E Model Pricing 30. Research has shown that products perceived to be of high quality tend to benefit less from price promotions than products perceived to be of lower quality. ANS: F They tend to benefit more from price promotions that products perceived to be of lower quality. PTS: 1 REF: 316 Thinking KEY: CB&E Model Pricing OBJ: 19-6 TOP: AACSB Reflective MSC: BLOOMS Comprehension MULTIPLE CHOICE 1. Price is best described as: a. b. c. d. e. that which is given up in exchange to acquire a good or service money exchanged for a good or service the psychological results of purchasing the cost in dollars for a good or service as...
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