Marketing Final Exam

Statements is not true with regard to trade ins a

Info icon This 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: following statements is NOT true with regard to trade-ins? a. Flexible pricing and trade-ins often go hand in hand. b. If a trade-in is involved, the consumer must negotiate two prices, one for the new product and one for the existing product. c. Research found that trade-in customers tend to care more about the trade-in value they receive than the price they pay for the new product. d. About 95 percent of all new car sales involve a trade-in. e. On average, customers who trade-in an automobile when purchasing a new one end up paying more than customers who simply buy a new car from a dealer. ANS: D A little over one half (57 percent) of all new car sales involve a trade-in. PTS: 1 REF: 329 Thinking KEY: CB&E Model Pricing OBJ: 20-3 TOP: AACSB Reflective MSC: BLOOMS Analysis 72. Eustis Lee is a lawyer who only handles DUI cases. No matter how quickly he resolves the case, he charges each customer $5,000. Lee justifies the fee because of his lengthy education and the years he has spent learning how the judicial system operates. Which pricing policy is the lawyer using? a. Professional services b. Potential (or base) c. Price maintenance d. Psychological e. Flexible (or variable) ANS: A Professional services pricing is used by people with lengthy experience, training, and often certification by a licensing board. PTS: 1 REF: 329 Thinking KEY: CB&E Model Pricing OBJ: 20-3 TOP: AACSB Reflective MSC: BLOOMS Application 73. Often a seller will establish a series of prices for a family of merchandise items. There may be several different models at specific price points but no prices in between. This policy is called: a. price lining b. price bracketing c. family pricing d. variable pricing e. price bundling ANS: A Price lining is the practice of offering a product line with several items at specific price points. PTS: 1 REF: 329 Thinking KEY: CB&E Model Pricing OBJ: 20-3 TOP: AACSB Reflective MSC: BLOOMS Comprehension 74. At the Greenville Florist, there are four different prices for funeral bouquets. The smallest bouquet sells for $30; there is also a $40 version and a $75 version. For those who want to express their grief through the purchase of a dramatic floral arrangement, the florist also offers a $150 version. The owner of the florist shop has chosen price lining because it will: a. enable the shop to carry a larger total inventory b. maintain all of the product line at the same stage in the product life cycle confuse customers and allow salespeople to sell more of the expensive models reach several different target market segments thwart competitors that are trying to sell similar products c. d. e. ANS: D Price lining allows a retailer to appeal to several different target markets. It is not an uncommon strategy, and competitors probably use it. It should not affect inventory overall and will not confuse customers. PTS: 1 REF: 329 Thinking KEY: CB&E Model Pricing OBJ: 20-3 TOP: AACSB Reflective MSC: BLOOMS Application 75. Why is price...
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern