Marketing Final Exam

Equate price and quality pts 1 ref 316 thinking key

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Unformatted text preview: because most consumers feel that price is not directly related to quality ANS: C Most consumers equate price and quality. PTS: 1 REF: 316 Thinking KEY: CB&E Model Pricing OBJ: 19-6 TOP: AACSB Reflective MSC: BLOOMS Application 105. The dimensions of quality that are important to consumers include: a. versatility b. serviceability c. performance d. ease of use e. all of these choices ANS: E Durability and prestige are other dimensions. PTS: 1 REF: 317 Thinking KEY: CB&E Model Pricing OBJ: 19-6 TOP: AACSB Reflective MSC: BLOOMS Comprehension Tesla Motors “Going green” doesn’t have to be boring. The Tesla Roadster Sport is an electric car that goes from 0 to 60 in four seconds and drives more like a race car than an environmentally friendly ride. But that level of performance will set you back $128,500. As of 2009, Silicon Valley–based Tesla Motors, Inc. was the only company offering highway-compatible electric cars. Most Roadster Sport buyers are car enthusiasts and are buying them for the “fun toy” aspect of having an electric car rather than for environmental reasons. 106. Refer to Tesla Motors. The price of the Roadster was set so that total revenue was as large as possible relative to total costs. This represents a _____ approach. a. profit maximization b. market share pricing c. demand-oriented pricing d. sales maximization e. status quo pricing ANS: A Profit maximization means setting prices so that total revenue is as large as possible relative to total costs. PTS: 1 REF: 302 Thinking KEY: CB&E Model Pricing OBJ: 19-2 TOP: AACSB Reflective MSC: BLOOMS Application 107. Refer to Tesla Motors. If Tesla had assets of $5 million and net profits after taxes of $550,000, what is Tesla’s return on investment? a. 1 percent b. 9 percent c. 11 percent d. $14,135 e. $4,450,000 ANS: C Return on investment = Net profit after taxes ÷ Total assets OR Return on investment = $550,000 ÷ $5,000,000 PTS: 1 REF: 303 KEY: CB&E Model Pricing OBJ: 19-2 TOP: AACSB Analytic MSC: BLOOMS Analysis 108. Refer to Tesla Motors. What is the fixed cost contribution for the Roadster given average variable costs of $50,500? a. b. c. d. e. $50,500 $78,000 $128,500 $179,000 $500,000 ANS: B Fixed cost contribution is the price minus the average variable cost: $128,500 – $50,500 = $78,000. PTS: 1 REF: 312 KEY: CB&E Model Pricing OBJ: 19-5 TOP: AACSB Analytic MSC: BLOOMS Analysis 109. Refer to Tesla Motors. If total fixed costs are $23,400,000 and the average variable cost is $50,500, how many Roadsters must Tesla sell to break even? a. 130 b. 182 c. 250 d. 300 e. 463 ANS: D Breakeven quantity = Total fixed costs ÷ (Price – Average variable costs) OR Break-even quantity = 23,400,000 ÷ (128,500 – 50,500) OR Break-even quantity = Total fixed costs ÷ Fixed cost contribution (23,400,000 ÷ 78,000) PTS: 1 REF: 312 KEY: CB&E Model Pricing OBJ: 19-5 TOP: AACSB Analytic MSC: BLOOMS Analysis 110. Refer to Tesla Motors. Tesla set the price of the R...
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This document was uploaded on 09/29/2013.

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