Question 1

Which of the following is a psychological factor relevant to pricing decisions of a bakery?
A) How many loaves of bread will a potential buyer consume every month?
B) Are the orders coming from households or sandwich shops?
C) Will a low price indicate inferior quality to the potential buyer?
D) How many potential buyers for multigrain bread are there?

Accepted Answer

Psychological factors related to pricing concern primarily how consumers will perceive various prices or price changes. Psychological factors include questions such as, whether potential buyers will use price as an indicator of product quality. Expected consumption rate of potential buyers, position of potential buyers, and number of potential buyers are demographic factors relevant to pricing decisions.

Question 2

Fone Inc.is about to launch the latest version of its smartphone.As part of its pricing strategy,it is analyzing the economic strength of its potential buyers.Which of the following factors influencing pricing decisions is Fone concerned with?
A) Psychological factors
B) Environmental factors
C) Demographic factors
D) Price elasticity

Accepted Answer

Demographic factors that are particularly important for pricing decisions include the number of potential buyers, location of potential buyers, and the economic strength of potential buyers.

Question 3

Which of the following factors related to pricing is concerned primarily with how consumers perceive various prices or price changes?
A) Environmental factors
B) Psychological factors
C) Demographic factors
D) Sociological factors

Accepted Answer

Psychological factors related to pricing concern primarily how consumers will perceive various prices or price changes.

Question 4

Protectnow,Inc.is a company that sells insurance.Which of the following is an example of a psychological factor relevant to Protectnow's pricing decisions?
A) The position of its potential buyers
B) The expected number of insurances it will sell in the next fiscal year
C) The economic strength of its potential buyers
D) The prestige orientation of its potential buyers

Accepted Answer

The prestige orientation of potential buyers is a psychological factor influencing pricing decisions. Demographic factors that are particularly important for pricing decisions include the position (organizational buyers or final consumers), expected consumption rates, and the economic strength of potential buyers.

Question 5

Which of the following factors influencing pricing decisions pertains to demand influences for a product?
A) Environmental factors
B) Distinctiveness
C) Cost factors
D) Psychological factors

Accepted Answer

Demand influences on pricing decisions concern primarily the nature of the target market and expected reactions of consumers to a given price or change in price. There are three primary considerations here: demographic factors, psychological factors and price elasticity.

Question 6

_____ influences on pricing decisions concern primarily the nature of the target market and expected reactions of consumers to a given price or change in price.
A) Product
B) Environmental
C) Supply
D) Demand

Accepted Answer

Demand influences on pricing decisions concern primarily the nature of the target market and expected reactions of consumers to a given price or change in price.

Question 7

Which of the following is an example of a psychological factor relevant to the pricing decisions made for a collectible doll that sells for $299?
A) What is the discretionary income of prospective buyers of the doll?
B) Will prospective buyers view the doll's high price as an indicator of high quality?
C) Are the prospective buyers of the doll geographically clustered?
D) How many prospective buyers can afford to pay this much for a doll?

Accepted Answer

Psychological factors related to pricing concern primarily how consumers will perceive various prices or price changes. Psychological factors include questions such as, whether potential buyers will use price as an indicator of product quality. The discretionary income of prospective buyers and whether prospective buyers can afford the product are questions directly related to the economic strength of potential buyers. Economic strength of potential buyers and whether they are geographically clustered are demographic factors relevant to pricing decisions.

Question 8

Which of the following factors influencing pricing decisions pertains to the expected consumption rate of potential buyers,location of potential buyers,and position of potential buyers?
A) Psychological factors
B) Environmental factors
C) Demographic factors
D) Price elasticity

Accepted Answer

Demographic factors that are particularly important for pricing decisions include the number of potential buyers, location of potential buyers, and position of potential buyers.

Question 9

Which of the following is a factor influencing pricing decisions that are relevant to demand influences for a product?
A) Environmental factors
B) Distinctiveness
C) Cost factors
D) Demographic factors

Accepted Answer

Demand influences on pricing decisions concern primarily the nature of the target market and expected reactions of consumers to a given price or change in price. There are three primary considerations here: demographic factors, psychological factors and price elasticity.

Question 10

Which of the following best explains why Frito-Lay's potato chips are priced at 69 cents a bag rather than 70 cents?
A) To encourage consumers to think these chips are less expensive
B) To gain more consumers who are not too keen about the quality of the chips
C) To create a signal that these chips are exceptionally fine
D) To increase sales by giving discount offers

Accepted Answer

Frito-Lay's potato chips are priced at 69 cents a bag rather than 70 cents to encourage consumers to think of them as less expensive (60 some-odd cents) rather than 70 cents.

Question 11

A gas station in South San Francisco charges $4.29 instead of $4.30 for regular gas and $4.79 instead of $4.80 for premium gas to make the prices look less expensive.This is an example of _____ pricing.
A) prestige
B) bundle
C) markup
D) odd-even

Accepted Answer

Odd-even pricing is a psychological pricing strategy, in which prices are set a few dollars or a few cents below a round number to encourage the consumers to think of the product as less expensive.

Question 12

Which of the following is a demographic factor that influences the pricing decision of a product?
A) Buyers using price as an indicator of product quality
B) Potential buyers being favorably attracted by odd pricing
C) Prestige orientation of potential buyers
D) Expected consumption rates of potential buyers

Accepted Answer

Expected consumption rate of potential buyers is one of the demographic factors that influence the pricing decision of a product. Psychological factors include questions such as: (1) Will potential buyers use price as an indicator of product quality? (2) Will potential buyers be favorably attracted by odd pricing? (3) Are potential buyers prestige oriented and therefore willing to pay higher prices to fulfill this need?

Question 13

Which of the following is an example of a demographic factor that is significant to the pricing decisions of a new type of low-fat cereal for children?
A) How many boxes of the low-fat cereal will be consumed by a household in a month?
B) What price will indicate the quality of the cereal?
C) Are potential buyers of the cereal prestige oriented?
D) Will potential buyers be attracted to the cereal if its manufacturer uses odd pricing?

Accepted Answer

Demographic factors that are particularly important for pricing decisions include expected consumption rates of potential buyers. Psychological factors related to pricing concern primarily how consumers will perceive various prices or price changes. Psychological factors include questions such as: (1) Will potential buyers use price as an indicator of product quality? (2) Will potential buyers be favorably attracted by odd pricing? (3) Are potential buyers prestige oriented and therefore willing to pay higher prices to fulfill this need?

Question 14

Protectnow,Inc.is a company that sells insurance.Which of the following is an example of a demographic factor that would be relevant to Protectnow's pricing decisions?
A) The position of its potential buyers
B) The types of insurance it sells
C) The fact that its potential buyers use price as an indicator of product quality
D) The prestige orientation of its potential buyers

Accepted Answer

Demographic factors that are particularly important for pricing decisions include the position of potential buyers (organizational buyers or final consumers). The prestige orientation of potential buyers and whether potential buyers use price as an indicator of product quality are psychological factors influencing pricing decisions. The type of products that a company sells refers to the nature of products influencing pricing decisions.

Question 15

Hertz economy cars are rented for $129 rather than $130 to appear less expensive.This is an example of _____ pricing.
A) prestige
B) bundle
C) markup
D) odd-even

Accepted Answer

Odd-even pricing is a psychological pricing strategy, in which prices are set a few dollars or a few cents below a round number to encourage the consumers to think of the product as less expensive.

Question 16

Which of the following is a psychological factor affecting pricing decisions?
A) Expected consumption rates of potential buyers
B) Location of potential buyers
C) Chances of a buyer being favorably attracted by odd pricing
D) Economic strength of potential consumers

Accepted Answer

Chances of a buyer being favorably attracted by odd pricing is a psychological factor affecting pricing decisions. Expected consumption rates of potential buyers, location of potential buyers, and economic strength of consumers are demographic factors affecting pricing decisions.

Question 17

Which of the following is a demographic factor that influences the pricing decision of a product?
A) Potential buyers using price as an indicator of product quality
B) Potential buyers being favorably attracted by odd pricing
C) Prestige orientation of potential buyers
D) Economic strength of potential buyers

Accepted Answer

Economic strength of potential buyers is one of the demographic factors that influence the pricing decision of a product. Psychological factors include questions such as: (1) Will potential buyers use price as an indicator of product quality? (2) Will potential buyers be favorably attracted by odd pricing? (3) Are potential buyers prestige oriented and therefore willing to pay higher prices to fulfill this need?

Question 18

Which of the following is a psychological factor affecting pricing decisions?
A) Expected consumption rates of potential buyers
B) Location of potential buyers
C) Use of price as an indicator of quality by potential buyers
D) Economic strength of potential buyers

Accepted Answer

Whether potential buyers will use price as an indicator of quality is a psychological factor affecting pricing decisions. Expected consumption rates of potential buyers, location of potential buyers, and economic strength of consumers are demographic factors affecting pricing decisions.

Question 19

Which of the following factors influencing pricing decisions pertains to demand influences for a product?
A) Breakeven point
B) Target pricing
C) Cost-plus pricing
D) Price elasticity

Accepted Answer

Demand influences on pricing decisions concern primarily the nature of the target market and expected reactions of consumers to a given price or change in price. There are three primary considerations here: demographic factors, psychological factors and price elasticity.

Question 20

Travel agencies offer vacation packages that include travel,accommodations,and entertainment at a single price to signify value and convenience for customers.This is an example of _____ pricing.
A) odd-even
B) prestige
C) bundle
D) rate of return

Accepted Answer

Bundle pricing is a psychological pricing strategy, in which several products are sold together at a single price to suggest a good value.

Quiz 11: Pricing Strategy

Which of the following is a psychological factor relevant to pricing decisions of a bakery?

Fone Inc.is about to launch the latest version of its smartphone.As part of its pricing strategy,it is analyzing the economic strength of its potential buyers.Which of the following factors influencing pricing decisions is Fone concerned with?

Which of the following factors related to pricing is concerned primarily with how consumers perceive various prices or price changes?

Protectnow,Inc.is a company that sells insurance.Which of the following is an example of a psychological factor relevant to Protectnow's pricing decisions?

Which of the following factors influencing pricing decisions pertains to demand influences for a product?

_____ influences on pricing decisions concern primarily the nature of the target market and expected reactions of consumers to a given price or change in price.

Which of the following is an example of a psychological factor relevant to the pricing decisions made for a collectible doll that sells for $299?

Which of the following factors influencing pricing decisions pertains to the expected consumption rate of potential buyers,location of potential buyers,and position of potential buyers?

Which of the following is a factor influencing pricing decisions that are relevant to demand influences for a product?

Which of the following best explains why Frito-Lay's potato chips are priced at 69 cents a bag rather than 70 cents?

A gas station in South San Francisco charges $4.29 instead of $4.30 for regular gas and $4.79 instead of $4.80 for premium gas to make the prices look less expensive.This is an example of _____ pricing.

Which of the following is a demographic factor that influences the pricing decision of a product?

Which of the following is an example of a demographic factor that is significant to the pricing decisions of a new type of low-fat cereal for children?

Protectnow,Inc.is a company that sells insurance.Which of the following is an example of a demographic factor that would be relevant to Protectnow's pricing decisions?

Hertz economy cars are rented for $129 rather than $130 to appear less expensive.This is an example of _____ pricing.

Which of the following is a psychological factor affecting pricing decisions?

Which of the following is a demographic factor that influences the pricing decision of a product?

Which of the following is a psychological factor affecting pricing decisions?

Which of the following factors influencing pricing decisions pertains to demand influences for a product?

Travel agencies offer vacation packages that include travel,accommodations,and entertainment at a single price to signify value and convenience for customers.This is an example of _____ pricing.