Topic legal and ethical aspects of pricing 203 p 286

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Topic: Legal and Ethical Aspects of Pricing 203. (p. 286) If a telecommunications company drastically cuts the price for cellular phone service in order to eliminate local competitors, the company could be
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charged with: A. loss leader pricing. B. bait and switch pricing. C. price fixing. D. unfair slotting. E. predatory pricing. Predatory pricing is the setting of artificially low prices for products with the intention of driving competitors out of business. Predatory pricing is difficult to prove. AACSB: Ethics Blooms: Understand Difficulty: 3 Hard Learning Objective: 13-08 List pricing strategies that have the potential to deceive customers. Topic: Legal and Ethical Aspects of Pricing 204. (p. 287) It is legitimate for a manufacturer to charge a retailer a lower price than its usual price if: B2B quantity discounts are regulated by the Robinson-Patman Act. Ordinarily, all business buyers purchasing a given quantity should be charged the same price. One exception to the rule is that the seller can offer a lower price to match a competing offer. AACSB: Ethics Blooms: Understand Difficulty: 3 Hard Learning Objective: 13-08 List pricing strategies that have the potential to deceive customers. Topic: Legal and Ethical Aspects of Pricing 205. (p. 287) __________ is the practice of colluding with other firms to control prices. A. Competitive
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favoritism B. Industry tightening C. Monopolistic competition D. Price fixing E. Regressive pricing Price fixing occurs when firms work together to control prices. AACSB: Ethics Blooms: Understand Difficulty: 2 Medium Learning Objective: 13-08 List pricing strategies that have the potential to deceive customers. Topic: Legal and Ethical Aspects of Pricing 206. (p. 287) __________ price fixing occurs when competitors collude to control prices, and __________ price fixing occurs within a marketing channel to control prices passed on to consumers. A. Industry; supply chain B. General; specific C. Wide-spread; integrated D. Strategic; tactical E. Horizontal; vertical Horizontal price fixing occurs among competitors; vertical price fixing occurs within a channel. AACSB: Ethics Blooms: Understand Difficulty: 3 Hard Learning Objective: 13-08 List pricing strategies that have the potential to deceive customers. Topic: Legal and Ethical Aspects of Pricing 207. (p. 287) It is the responsibility of __________ to determine the ethical approach to setting prices so consumers find value and the firm can make a profit. A. the Better Business Bureau B. federal regulators C. the American Marketing Association D. marketers themselves E. industry standards boards
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Marketers must be aware of ethical considerations in pricing and should set prices accordingly.
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