kotler - chapter10
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Chapter 10 Pricing Products: Understanding and Capturing Customer Value
1) ________ is the amount of money charged for a product or service. A) Experience curve B) Demand curve C) Price D) Wage E) Salary Answer: C Diff: 1 Page Ref: 290 Skill: Concept Objective: 10-1
2) Price is the only element in the marketing mix that produces ________. A) revenue
B) variable costs C) expenses
D) outfixed costs E) stability Answer: A Diff: 1 Page Ref: 290 Skill: Concept Objective: 10-1
3) ________ is an important element in the marketing mix. It is the only element that does not represent costs.
A) Current profit maximization B) Market share leadership C) Price
D) Product quality leadership E) The target market Answer: C Diff: 1 Page Ref: 290 Skill: Concept Objective: 10-1
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Copyright ? 2010 Pearson Education, Inc. Publishing as Prentice Hall
4) Consumer perceptions of the product's value set the ________ for prices. A) demand curve B) floor C) ceiling
D) variable cost E) image Answer: C Diff: 2 Page Ref: 291 Skill: Concept Objective: 10-2
5) Product costs set a(n) ________ to a product's price. A) demand curve B) floor C) ceiling
D) break-even cost E) experience curve Answer: B Diff: 2 Page Ref: 291 Skill: Concept Objective: 10-2
6) Which of the following is a customer-oriented approach to pricing? A) value-based pricing B) sealed-bid pricing C) break-even pricing D) target profit pricing E) C and D Answer: A Diff: 2 Page Ref: 291 Skill: Concept Objective: 10-2
7) ________ uses buyers' perceptions of what a product is worth, not the seller's cost, as the key to pricing.
A) Value-based pricing B) Value-added pricing C) Variable cost D) Price elasticity E) Product image Answer: A Diff: 2 Page Ref: 291 Skill: Concept Objective: 10-2
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Copyright ? 2010 Pearson Education, Inc. Publishing as Prentice Hall
8) In ________, price is considered along with the other marketing mix variables before the marketing program is set. A) value-based pricing B) cost-based pricing C) variable costs D) price elasticity
E) building the marketing mix Answer: A Diff: 2 Page Ref: 291 Skill: Concept Objective: 10-2
9) Value-based pricing is the reverse process of ________. A) variable cost pricing B) cost-plus pricing C) cost-based pricing D) good-value pricing E) value-added pricing Answer: C Diff: 2 Page Ref: 291 Skill: Concept Objective: 10-2
10) With ________, price is set to match consumers' perceptions of product value. A) variable cost pricing B) cost-plus pricing C) cost-based pricing D) value-based pricing E) every day low pricing Answer: D Diff: 2 Page Ref: 291 Skill: Concept Objective: 10-2
11) Measuring ________ can be difficult. A company might conduct surveys or experiments to test this in the different products they offer. A) price elasticity B) the demand curve C) perceived value D) break-even pricing E) quantity supplied Answer: C Diff: 3 Page Ref: 292 AACSB: Communication Skill: Concept Objective: 10-2
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Copyright ? 2010 Pearson Education, Inc. Publishing as Prentice Hall
12) Underpriced products sell very well, but they produce less revenue than they would have if price were raised to the ________ level. A) perceived B) value-based C) variable
D) demand curve E) price-floor Answer: A Diff: 2 Page Ref: 292 Skill: Concept Objective: 10-2
13) If a seller charges ________ than the buyer's perceived value, the company's sales will ________.
A) more; benefit B) more; suffer C) less; increase D) less; suffer
E) none of the above Answer: B Diff: 2 Page Ref: 292 Skill: Concept Objective: 10-2
14) Some companies have adopted a ________ strategy, offering just the right combination of quality and good service at a fair price. A) value-based pricing B) good-value pricing C) cost-plus pricing D) low-price image E) none of the above Answer: B Diff: 1 Page Ref: 293 Skill: Concept Objective: 10-2
15) Wal-Mart is famous for using what important type of value pricing? A) competition-based pricing B) everyday low pricing C) cost-plus pricing D) break-even pricing E) penetration pricing Answer: B Diff: 2 Page Ref: 293 Skill: Concept Objective: 10-2
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Copyright ? 2010 Pearson Education, Inc. Publishing as Prentice Hall
16) ________ involves charging a constant, everyday low price with few or no temporary price discounts.
A) High-low pricing B) Target pricing C) Cost-plus pricing D) EDLP
E) Penetration pricing Answer: D Diff: 2 Page Ref: 293 Skill: Concept Objective: 10-2
17) ________ involves attaching features and services to differentiate a company's offers and to support charging higher prices.. A) Break-even pricing B) Target pricing
C) Value-added pricing D) Cost-plus pricing E) Pricing-down Answer: C Diff: 1 Page Ref: 293 Skill: Concept Objective: 10-2
18) ________ is a company's power to escape price competition and to justify higher prices and margins.
A) Variable cost B) Pricing power C) Target cost D) Fixed cost E) Unit cost Answer: B Diff: 2 Page Ref: 293 Skill: Concept Objective: 10-2
19) To maintain and increase a company's ________, a firm must retain or build the value of its marketing offer. A) variable cost B) pricing power C) target cost D) fixed cost E) image Answer: B Diff: 3 Page Ref: 293 Skill: Concept Objective: 10-2
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Copyright ? 2010 Pearson Education, Inc. Publishing as Prentice Hall
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