Unformatted text preview: P: AACSB Reflective MSC: BLOOMS Comprehension 111. During a recent recession, many manufacturers determined that their suppliers were an excellent
source of cost savings. Specific cost reduction strategies manufacturers have used with their
offering help in boosting productivity of
setting annual across-the-board cost reduction
targets for suppliers
improving economies of scale by cutting
number of suppliers
all of the choices
Tough tactics like these help keep companies afloat during economic downturns.
KEY: CB&E Model Pricing OBJ: 20-5 TOP: AACSB Reflective MSC: BLOOMS Comprehension Art Supplies
It’s September and Sophia wants to buy some arts and crafts supplies for an after-school program
she is developing for her daughter’s elementary school. In her Sunday newspaper was a flyer
from Michaels, an arts and crafts retailer. As she looked through the newspaper insert, she noticed
that if she purchased three or more bottles of Alene’s Tacky Glue, the regular price of $1.50 each
was reduced to $1.15 each. She also saw that the store priced its plastic storage boxes at $1.99,
$3.99, and $5.99. She thought they would be useful for storing each child’s projects. On the front
page of the flyer was an ad for Funky Girls Gel Pens, something she knew her daughter would
love to use. The price at Michael’s was $6.99 lower than the price she had found at the other
stores that carried the pens. She thought that some of the older girls might like to start a
scrapbook and was pleased to find that Michaels had a scrapbook starter kit, which includes
scissors, book, pages, and stickers for only $15. The items could be purchased separately for
$19.99. The flyer also announced that all flag-related items leftover from its Fourth of July sale
were reduced by 40 percent.
112. Refer to Art Supplies. Which type of discount is being used to price the tacky glue?
Noncumulative quantity discount
Cumulative quantity discount
A noncumulative quantity discount is a reduction from list price that applies to a single order
rather than to the total volume placed during a specific period.
KEY: CB&E Model Pricing OBJ: 20-3 TOP: AACSB Reflective MSC: BLOOMS Application 113. Refer to Art Supplies. Which of the following merchandise is offered in the flyer with a seasonal
Plastic storage boxes
Funky Girls Gel Pens
Scrapbook starter kit
Seasonal discounts are pricing reductions for buying merchandise out of season.
KEY: CB&E Model Pricing OBJ: 20-3 TOP: AACSB Reflective MSC: BLOOMS Application 114. Refer to Art Supplies. What pricing practice was used to price the plastic storage boxes?
Inelastic pricing e. Cumulative pricing ANS: C
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- Fall '13
- Marketing, AACSB Reflective, CB&E Model Strategy, CB&E Model