Deck 12: Pricing, Distributing, and Promoting Products

Question 1

Wholesalers are intermediaries who sell products directly to consumers.

Answer 1

False

Question 2

If prices are set too high,the company will make a large profit on each item but will sell fewer units.

Answer 2

True

Question 3

Selling price equals seller's costs plus profit.

Answer 3

True

Question 4

Intermediaries,once called middlemen,include wholesalers and retailers.

Question 5

Companies using price lining offer all items in certain categories at a limited number of prices.

Question 6

E-catalogs are unlikely to account for more sales than mail order catalogs.

Question 7

Shopping agents (e-agents)help people shop from factory outlet stores.

Question 8

Specialty stores typically carry one line of related products and feature knowledgeable sales personnel.

Question 9

Price skimming occurs when a company sets an initially low price to establish a new product in the market.

Question 10

Most business goods are distributed directly from the manufacturer to the user.

Question 11

Penetration pricing is characterized by low prices.

Question 12

Market share (or market penetration)is a company's percentage of the total industry sales for a specific product type.

Question 13

Convenience stores are Internet-based channel members who collect information about sellers and present it to consumers and/or help deliver Internet products to buyers.

Question 14

Wholesalers take legal possession of goods produced by a variety of manufacturers and then resell them to other businesses.

Question 15

The distribution mix is the combination of distribution channels that a firm selects to get a product to end users.

Question 16

Variable costs change with the quantity of a product produced or sold.

Question 17

Over one-half of U.S.retailers account for less than 10 percent of all retail sales.

Question 18

Markup is the amount deducted from an item's purchase cost to sell it at a profit.

Question 19

Discount houses,catalog showrooms,and factory outlets are product-line retailers.

Question 20

The breakeven point is the quantity of a product that must be sold to maximize profits.

Question 21

Premiums are what the customer pays to enter a contest to win prizes.

Question 22

Private warehouses are owned by a single manufacturer,wholesaler,or retailer.

Question 23

Although there were some in the past,modern society no longer has direct channels of distribution.

Question 24

The four elements of the promotional mix are coupons,rebate,trade shows,and point-of-purchase displays.

Question 25

When making pizzas,the cost of the cheese would be considered a fixed cost.

Question 26

A coupon is a form of sales promotion.

Question 27

Sales promotions are short-term promotional activities designed to stimulate consumer buying or cooperation from distributors,sales agents,or other members of the trade.

Question 28

To grab customers' attention in stores,companies use trade shows.

Question 29

Advertising is paid communication used by an identified sponsor to inform an audience about a product.

Question 30

A distribution channel is the path that a product follows from producer to end user.

Question 31

Shopping at home from channels on your TV is called video marketing and is a form of interactive marketing.

Question 32

Cost-oriented pricing considers the firm's desire to make a profit and takes into account the need to cover production costs.

Question 33

Using psychological pricing,a restaurant would price an entree at $10.00,rather than $9.95.

Question 34

Promotion is the process of establishing an easily identifiable product image in the minds of consumers by fixing,adapting,and communicating the nature of the product itself.

Question 35

Publicity is information about a company,a product,or an event transmitted by the general mass media to attract public attention.

Question 36

Market share is a pricing strategy that emphasizes maximizing profits.

Question 37

Most business products are distributed through direct channels.

Question 38

All prices are established with the objective of maximizing profit for the firm.

Question 39

The oldest and most expensive form of sales is personal selling in which a salesperson communicates one-on-one with potential customers to identify their needs and align them with the product.

Question 40

Products priced above the market play on the common assumption that a higher price means higher quality.

Question 41

When using e-catalogs,the seller avoids mail distribution and printing costs; however,once an online catalog is in place,there are high costs in maintaining and accessing it.

Question 42

In addition to physical goods,POS pedestals also provide services,namely information for consumers.

Question 43

Supermarkets stress low prices,self-service,and wide selection.

Question 44

Positioning is the process of establishing an easily identifiable product image in the minds of consumers.

Question 45

Marketers must find out who their customers are,which media they pay attention to,what messages appeal to them,and how to get their attention.

Question 46

Of all transport modes,using airplanes is the least expensive.

Question 47

There are more than 3 million brick-and mortar retail establishments in the United States.

Question 48

Because railroads do not have limited delivery routes,they can economically transport high-volume,heavy,bulky items,such as cars,steel,and coal.

Question 49

Order processing is a personal selling task used when a company seeks to promote itself and its products rather than simply to close a sale.

Question 50

LivePerson.com is an example of interactive marketing in which a leading provider of real-time sales and customer service allows customers to enter a live chat room with a service operator who can answer their specific product questions.

Question 51

Many firms have turned to distribution as a cornerstone of business strategy assessing and improving the entire stream of activities involved in getting products to customers.

Question 52

High-speed transmission is suited to distribution of most types of products.

Question 53

With more than 3 million drivers,trucks haul more than two-thirds of all tonnage carried by all modes of U.S.freight transportation.

Question 54

Most wholesalers are independent operations that buy products from manufacturers and sell them to various consumers or other businesses.

Question 55

Agents and brokers buy products from manufacturers and then sell them to other businesses.

Question 56

Pharmaceutical companies often use missionary selling.

Question 57

The ultimate objective of any promotion is to increase sales.

Question 58

Shopping agents allow consumers to purchase products directly from their site.

Question 59

Direct selling is the main strategy of such firms as Tupperware,Amway,and Avon.

Question 60

One downfall of nondirect distribution is lower prices.

Question 61

Unlike agents and brokers,wholesalers do not own their merchandise.

Question 62

With fixed costs of $100,000 and a variable cost of $8,a $15 CD must sell at least 20,000 units to break even.

Question 63

Vending machines make up 8% of all U.S.retail sales.

Question 64

Half of the nation's retailers account for half of all retail sales.

Question 65

________ are goals that producers hope to attain in pricing products.

A) Profit targets
B) Returns on investment
C) Pricing targets
D) Pricing objectives

Question 66

With fixed costs of $50,000 and a variable cost of $5,a $10 widget must sell at least 10,000 units to break even.

Question 67

The Men's Store offers sweatshirts at three prices: $28,$42,and $60; this illustrates price lining.

Question 68

A $114 gadget with a $22 markup has a markup percentage of 28.5 percent.

Question 69

________ costs change with the quantity of a product sold or produced.

A) Annual
B) Variable
C) Fixed
D) Margin

Question 70

Marketers have control over the content media reporters and writers disseminate,and because it is presented in a news format,consumers often regard it as objective and credible.

Question 71

According to the text,one theory states that consumers prefer prices that are stated in even dollars.

Question 72

Many firms do not engage in publicity because the charges for such promotion are too high.

Question 73

The electronic marketplace has turned from a variable pricing system to a fixed pricing system.

Question 74

The value of agents and brokers lies in their knowledge of markets and their merchandising expertise.

Question 75

With a markup percentage of 46.7 percent,a $15 CD must have a markup of $7.

Question 76

Intermediaries can provide a speedier delivery of products,but real added value is not provided.

Question 77

Costs that are unaffected by the quantity of a product sold are ________ costs.

A) variable
B) selling
C) fixed
D) on-going

Question 78

The amount added to a product's cost in order to sell it at a target profit is called ________.

A) profit points
B) profit allowance
C) revenue margin
D) markup

Question 79

Most of the world's largest retailers are U.S.retailers.

Question 80

Convenience stores differ from most bargain retailers in that they do not feature low prices.