Question 1

A firm would likely pursue penetration pricing when

Accepted Answer

A penetration pricing approach might be wise when the elite market-those willing to pay a high price-is small and when the whole demand curve is fairly elastic.

Question 2

A leading hard-disk manufacturer introduces a new line of high-capacity disk drives.After selling to elite customers at a high price point,the company slowly reduces its prices over a period of time.The company is engaging in

Accepted Answer

A skimming price policy tries to sell the top (skim the cream)of a market-the top of the demand curve-at a high price before aiming at more price-sensitive customers.A skimming policy usually involves a slow reduction in price over time.As price is reduced,new target markets emerge.

Question 3

A penetration pricing policy

Accepted Answer

A penetration pricing policy tries to sell the whole market at one low price.

Question 4

Which pricing policy is probably best for a profit-oriented,low-cost producer who is introducing a new product into a market with elastic demand and is expecting strong competition very soon after product introduction?

Accepted Answer

A penetration pricing policy tries to sell the whole market at one low price when the whole demand curve is fairly elastic and the firm expects strong competition very soon after introduction.

Question 5

Quantity discounts are offered by sellers to

Accepted Answer

Quantity discounts are discounts offered to encourage customers to buy in larger amounts.This lets a seller get more of a buyer's business,or shifts some of the storing function to the buyer,or reduces shipping and selling costs-or all of these.

Question 6

The use of temporary price cuts to speed new products into a market and encourage trial by customers is

Accepted Answer

Introductory price dealings are temporary price cuts to speed new products into a market and get customers to try them.

Question 7

Which of the following observations concerning introductory price dealing is true?

Accepted Answer

Introductory price dealings are temporary price cuts to speed new products into a market and get customers to try them.

Question 8

Over time,a skimming policy often involves

Accepted Answer

A skimming policy often involves a slow reduction in price over time to aim at more price-sensitive customers.

Question 9

A penetration pricing policy

Accepted Answer

A penetration pricing policy tries to sell the whole market at one low price.It may be wise if the firm expects strong competition very soon after introduction.

Question 10

Trying to sell a firm's new product to a large market at one low price is known as

Accepted Answer

A penetration pricing policy tries to sell the whole market at one low price.

Question 11

________ are reductions from list price that are given by a seller to a buyer who either gives up some marketing function or provides the function himself.

Accepted Answer

Discounts are reductions from list price given by a seller to buyers who either give up some marketing function or provide the function themselves.

Question 12

A skimming pricing policy

Accepted Answer

A skimming policy often involves a slow reduction in price over time to aim at more price-sensitive customers.

Question 13

A penetration pricing policy

Accepted Answer

A penetration pricing policy tries to sell the whole market at one low price.

Question 14

Using temporary price cuts to speed a producer's new product into a market is known as

Accepted Answer

Introductory price dealings are temporary price cuts to speed new products into a market and get customers to try them.

Question 15

Final customers or users are normally asked to pay ________ prices for products they buy.

Accepted Answer

Basic list prices are the prices final customers or users are normally asked to pay for products.

Question 16

Unilever is introducing a new brand of car-window cleaner in market maturity.To speed its entry into the market-without encouraging price competition-Unilever should use

Accepted Answer

Introductory price dealings are temporary price cuts to speed new products into a market and get customers to try them.

Question 17

When setting a price-level policy,a good marketing manager knows that

Accepted Answer

Introductory price dealing usually increases sales; penetration pricing makes the most sense when there is a small elite market; skimming pricing may lead to high profits if demand is very elastic; and it's easier to lower prices if the initial price is too high.

Question 18

________ are the prices final customers or users are normally asked to pay for products.

Accepted Answer

Basic list prices are the prices final customers or users are normally asked to pay for products.

Question 19

Some developers of apps for the Apple iPhone price their apps low at launch to encourage sales and get attention so they can move into the prestigious "Top 25" list.Then,they frequently raise prices to get a higher profit margin on later sales.The initial low price is a(n)

Accepted Answer

Introductory price dealings are temporary price cuts to speed new products into a market and get customers to try them.

Question 20

Introductory price dealing

Accepted Answer

Introductory price dealings are temporary price cuts to speed new products into a market and get customers to try them.However,don't confuse these temporary price cuts with low penetration prices,as the plan here is to raise prices as soon as the introductory offer is over.

Quiz 17: Pricing Objectives and Policies

A firm would likely pursue penetration pricing when

A leading hard-disk manufacturer introduces a new line of high-capacity disk drives.After selling to elite customers at a high price point,the company slowly reduces its prices over a period of time.The company is engaging in

A penetration pricing policy

Which pricing policy is probably best for a profit-oriented,low-cost producer who is introducing a new product into a market with elastic demand and is expecting strong competition very soon after product introduction?

Quantity discounts are offered by sellers to

The use of temporary price cuts to speed new products into a market and encourage trial by customers is

Which of the following observations concerning introductory price dealing is true?

Over time,a skimming policy often involves

A penetration pricing policy

Trying to sell a firm's new product to a large market at one low price is known as

________ are reductions from list price that are given by a seller to a buyer who either gives up some marketing function or provides the function himself.

A skimming pricing policy

A penetration pricing policy

Using temporary price cuts to speed a producer's new product into a market is known as

Final customers or users are normally asked to pay ________ prices for products they buy.

Unilever is introducing a new brand of car-window cleaner in market maturity.To speed its entry into the market-without encouraging price competition-Unilever should use

When setting a price-level policy,a good marketing manager knows that

________ are the prices final customers or users are normally asked to pay for products.

Some developers of apps for the Apple iPhone price their apps low at launch to encourage sales and get attention so they can move into the prestigious "Top 25" list.Then,they frequently raise prices to get a higher profit margin on later sales.The initial low price is a(n)

Introductory price dealing