Question 1

Veggie Vitality will send retailers a check if they promote their vegetable-based smoothies in the retailer's promotional efforts.Veggie Vitality uses ______________.

Accepted Answer

Veggie Vitality is providing a promotional allowance to retailers to promote their vegetable-based smoothies in the retailer's promotional efforts.

Question 2

As with average-cost pricing, the effectiveness of __________________ is highly dependent on the accuracy of the forecast.

Accepted Answer

As with average-cost pricing, the effectiveness of target return pricing is highly dependent on the accuracy of the forecast.

Question 3

_______________ are typically expressed as greatly extended invoice due dates.

Accepted Answer

The answer of _______________ are typically expressed as greatly extended...

Question 4

_________________ uses the sales price as a basis of calculating the markup percentage.

Accepted Answer

Markup on sales price is a pricing method in which the markup percentage is calculated based on the sales price. It involves adding a certain percentage (markup) to the cost of a product to determine its selling price. This method ensures that the markup percentage remains the same regardless of changes in the cost of the product or other pricing factors. It is commonly used in retail and wholesale businesses.

Question 5

__________________ means that title transfer and freight paid on the goods being shipped are based on the free on board location.

Accepted Answer

FOB pricing means that the buyer takes responsibility for the goods once they are loaded onto a shipping vessel at the designated FOB location. The title transfer and freight costs are based on this location. This is a common pricing term used in international trade.

Question 6

To accommodate lengthy sales processes, firms offer ______________, which reward the purchaser for shifting part of the inventory storage function away from the manufacturer.

Accepted Answer

To accommodate lengthy sales processes, firms offer seasonal discounts, which reward the purchaser for shifting part of the inventory storage function away from the manufacturer. Seasonal discounts are often expressed as greatly extended invoice due dates.

Question 7

The Internet helped to create a market for ___________________ where sellers bid prices to capture a buyer's interest.

Accepted Answer

Reverse auction is a type of auction where sellers compete to obtain business from the buyer, and prices typically decrease as sellers underbid each other. The Internet has facilitated this process by providing platforms for reverse auctions.

Question 8

_____________ are incurred over time, regardless of volume.

Accepted Answer

Fixed costs are incurred over time and do not change regardless of the volume of goods produced or services rendered. Variable costs, on the other hand, fluctuate with the volume of goods or services produced. Total costs are the sum of fixed and variable costs.

Question 9

Solid Surface, a countertop store will give customers a 10% discount if they pay their bills in full in 20 days, however after 20 days they do not receive a discount.This is an example of _______________.

Accepted Answer

The given scenario describes a cash discount, where customers receive a discount for paying their bills in full within a specified time period.

Question 10

_____________ remit monies to purchasers after the fact.

Accepted Answer

The term "allowances" refers to the amounts that a seller may remit to their purchasers after the fact, as a form of compensation or rebate. This is in contrast to "discounts," which are typically offered at the time of purchase, and may reflect a reduction in price due to factors like bulk orders or prompt payment. Fixed costs, variable costs, and total costs are all measures of a company's expenses, and do not relate directly to the practice of offering allowances.

Question 11

Giovanni's Gems is a high quality Italian leather goods store in Manhattan.Giovanni runs an Internet site where people can buy his products and he will charge the same delivery fee to any location within the 48 contiguous states.Giovanni utilizes ______________.

Accepted Answer

Giovanni's use of a uniform delivery fee to any location within the 48 contiguous states is an example of uniform delivered pricing. With this pricing strategy, the seller charges the same delivery or shipping fee regardless of the destination of the product within a given region. This approach simplifies the pricing structure and makes it easier for both the seller and the customer to understand the costs involved.

Question 12

To better take into account the differential impact of fixed and variable costs, marketing managers can use _________________.

Accepted Answer

Target return pricing takes into account fixed and variable costs and aims to set prices that will allow the company to reach a specific level of return on investment. This approach is therefore better suited to consider the differential impact of fixed and variable costs than the other options listed.

Question 13

The Internet created a rise in ___________________ as more and more people decided to meet online in order to sell products to the highest bidder.

Accepted Answer

The statement describes the rise of online auctions, which allow people to sell products to the highest bidder on the internet. This type of pricing strategy is known as auction pricing.

Question 14

Caution is warranted in employing _________________, as it is always possible that the quantity demanded will not match the marketing manager's forecast.

Accepted Answer

Caution is warranted in employing average-cost pricing, as it is always possible that the quantity demanded will not match the marketing manager's forecast.

Question 15

To use target return pricing, one must first calculate total _______________.

Accepted Answer

The answer of To use target return pricing, one must...

Question 16

James is trying to determine the best price for his new fishing poles.He decided to divide all of his costs by the number of fishing poles he will be manufacturing, to come up with a price.James is using _________________.

Accepted Answer

James is using average-cost pricing, which involves dividing the total cost by the number of units produced to determine a per-unit cost. This cost is then used as the basis for setting the price for the product.

Question 17

From a legal standpoint, it is essential that ________________ are offered to all customers on an equally proportionate basis so that small buyers as well as large buyers follow the same rules for qualification.

Accepted Answer

Quantity discounts should be offered on an equally proportionate basis to ensure fairness and compliance with legal standards, allowing both small and large buyers to qualify under the same rules.

Question 18

Heather runs Cute Cakes, a gourmet cupcake bakery.In order to set prices for her cupcakes Heather looks at the costs of making each cupcake and then adds an additional amount on top of that to arrive at her price.Heather is demonstrating _____________.

Accepted Answer

Heather is using cost plus pricing, which involves adding a markup to the cost of production to determine the selling price.

Question 19

_____________ fluctuate with volume.

Accepted Answer

Variable costs are expenses that change in proportion to the amount of goods or services produced or sold. As volume increases, variable costs also increase. Fixed costs, on the other hand, remain constant regardless of volume. Total costs include both fixed and variable costs and may fluctuate with volume, but the question specifically asks about which costs fluctuate with volume, so the answer is B.

Question 20

______________ are direct, immediate reductions in price provided to purchasers.

Accepted Answer

Discounts are direct, immediate reductions in price provided to purchasers. Fixed costs, variable costs, and total costs are not related to price reductions. Allowances are a type of discount but are not the specific answer for this question.

Quiz 14: Managing Pricing Decisions