Question 1

What is predatory pricing? What federal acts make it illegal? How are consumers hurt by predatory pricing?

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Question 2

Why do marketers of new and innovative products often start out with a price skimming strategy rather than a penetration strategy?

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Question 3

Differentiate between the four levels of competition and offer examples of each type.

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Question 4

Small-business consultants are constantly admonishing would-be entrepreneurs,"Beware of the overhead." Using an overhead of $100,000 and then an overhead of $200,000,with a contribution per unit of $50,determine the break-even points.

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Question 5

Explain the concept of the high / low strategy.Why is this an attractive strategy to marketers?

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Question 6

Raymond estimates the fixed costs associated with opening a new bank branch are $500,000.He estimates the branch will attract 1,000 new customers who will cost $50 / year to service each of their accounts.He also expects to generate $100,000 in fees annually from these accounts.What will be the total cost of opening the new branch and remaining open for one year?

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Question 7

Brandon is conducting an experiment by charging different prices for the same products at different stores and measuring sales.With this information,he will construct a demand curve.How can Brandon use this information?

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Question 8

Karen initially charged $80 for an hour-long massage and averaged 20 clients per week.When she raised her price to $100,the number of massages decreased to 15 per week.What is the price elasticity of demand for her service?

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Question 9

Why is it more fun and challenging for a marketer to be part of a market characterized by monopolistic competition than to be part of one characterized by pure competition?

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Question 10

Explain how the demand curve works,and how it benefits a firm.

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Quiz 14: Pricing Concepts for Establishing Value