Marketing Final Exam

Of charging a very low price for a product with the

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: C: BLOOMS Analysis 27. The practice of charging a very low price for a product with the intent of driving competitors out of business or out of a market is called: a. price discrimination b. predatory pricing c. price fixing d. price manipulation e. anti-competitive pricing ANS: B This is the definition of predatory pricing. Firms using such pricing charge very low prices, and once competitors have been driven out; the firm raises its prices. PTS: 1 REF: 324 Thinking KEY: CB&E Model Pricing OBJ: 20-2 TOP: AACSB Reflective MSC: BLOOMS Knowledge 28. When Microsoft introduced its Zune MP3 player, many people thought it would capture the MP3 player market by pricing its product so low that a smaller competitor, like the Apple iPod, would be unable to compete. If Microsoft had used this approach, it have been would be guilty of: a. predatory pricing b. unfair trade practices c. channel manipulation pricing d. price fixing e. price discrimination ANS: A Predatory pricing is the practice of charging a very low price for a product with the intent of driving competitors out of business or out of a market. PTS: 1 REF: 324 Thinking KEY: CB&E Model Pricing OBJ: 20-2 TOP: AACSB Reflective MSC: BLOOMS Application 29. After managers understand both the legal and the marketing consequences of price strategies, they should set a _____ price––the general level at which a company expects to sell a good or service. a. functional b. c. d. e. zone demand leader base ANS: E One the base price is set, then the marketer fine-tunes it using discounts, allowances, rebates, and value-based pricing. PTS: 1 REF: 324-325 Thinking KEY: CB&E Model Pricing OBJ: 20-3 TOP: AACSB Reflective MSC: BLOOMS Knowledge 30. All of the following are tactics for fine-tuning the base price EXCEPT: a. functional discounts b. cash discounts c. rebates d. quality discounts e. quantity discounts ANS: D Additional tactics include seasonal discounts, promotional allowances, zero-percent financing, and value-based pricing. PTS: 1 REF: 325 Thinking KEY: CB&E Model Pricing OBJ: 20-3 TOP: AACSB Reflective MSC: BLOOMS Analysis 31. Last year, a single infield box ticket for an Atlanta Braves baseball game cost $40, but fans who bought a season pass for the same seat got a reduced price. This $40 price was a _____ price. a. base b. zone c. demand d. channel leader e. functional ANS: A The base price is the general price level at which a company intends to sell its product. PTS: 1 REF: 325 Thinking KEY: CB&E Model Pricing OBJ: 20-3 TOP: AACSB Reflective MSC: BLOOMS Application 32. When a buyer pays a lower price for buying multiple units or above a specified dollar amount for a single order, the buyer is receiving a _____ discount. a. promotional b. quantity c. frequent buyer d. functional e. cumulative ANS: B A quantity discount is a price deduction offered to customers buying in multiple units or making a purchase above a specified dollar amount. PTS: 1 REF: 325 Thinking KEY: CB&amp...
View Full Document

This document was uploaded on 09/29/2013.

Ask a homework question - tutors are online