Exam (elaborations)
Chapter 11 Developing Pricing Strategies and Programs
- Course
- Business
- Institution
- West Virginia Business College
Chapter 11 Developing Pricing Strategies and Programs
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Chapter 11 Developing Pricing Strategies and Programs1) When consumers examine products, they often compare an observed price to an internal
price they remember. This is known as a(n) price.
A) markup
B) reference
C) market-skimming
D) accumulated
E) target
Answer: B
Diff: 1
LO: 16.1: How do consumers process and evaluate prices?
AACSB: Reflective thinking
2) price refers to what the consumers feel the product should cost.
A) Fair
B) Typical
C) Usual discounted
D) List
E) Maximum retail
Answer: A
Diff: 1
LO: 16.1: How do consumers process and evaluate prices?
,AACSB: Reflective thinking
3) While shopping at the mall, Jane was asked by one of the sales representatives at the
cosmetics counter to try out a new lipstick that her company was test marketing. The
company representative asks her how much she would be willing to pay for the lipstick.
After trying it out, Jane is of the opinion that $5 is just the right price for it. What type of a
reference price is Jane using?
A) usual discounted price
B) fair price
C) maximum retail price
D) last price paid
E) historical competitor price
Answer: B
Diff: 2
LO: 16.1: How do consumers process and evaluate prices?
AACSB: Analytical thinking; Application of knowledge
,4) The reservation price, the maximum that most consumers will pay for a given product, is
known as the price.
A) expected future
B) usual discounted
C) upper-bound
D) typical
E) historical competitor
Answer: C
Diff: 1
LO: 16.1: How do consumers process and evaluate prices?
AACSB: Reflective thinking
5) Which of the following is NOT one of the possible consumer reference prices?
A) typical price
B) actual future price
C) last price paid
D) expected future price
E) upper-bound price
Answer: B
Diff: 3
LO: 16.1: How do consumers process and evaluate prices?
AACSB: Analytical thinking
6) A company decided to conduct a market survey for its new MP3 player that the company
had priced at $150. In the survey, 95 percent of participants said that the maximum they
would pay for the MP3 player is $100. This is an example of which of the following possible
consumer reference prices?
A) historical competitor price
B) expected future price
C) usual discounted price
D) upper-bound price
E) last price paid
Answer: D
Diff: 2
LO: 16.1: How do consumers process and evaluate prices?
AACSB: Analytical thinking; Application of knowledge
, 7) The minimum price that most consumers would pay for a given product is known as the
price.
A) everyday low
B) usual discounted
C) fair
D) typical
E) lower-bound
Answer: E
Diff: 1
LO: 16.1: How do consumers process and evaluate prices?
AACSB: Reflective thinking
8) A company has developed the prototype of a mobile phone that it plans to launch in the
next few months. The phone comes equipped with the most advanced technological
features. As part of its test marketing efforts, the company allows customers to examine and
use the prototype and also gathers feedback regarding product features and price. The
results of this test marketing effort show that customers are willing to pay at least $500,
considering the phone's various features. As such, the company has discovered customers'
.
A) last paid price
B) expected future price
C) lower-bound price
D) upper-bound price
E) typical price
Answer: C
Diff: 2
LO: 16.1: How do consumers process and evaluate prices?
AACSB: Analytical thinking; Application of knowledge
9) Many consumers are willing to pay $100 for a perfume that contains $10 worth of scent
because the perfume is from a well-known brand. What kind of pricing is the company
depending on?
A) going-rate pricing
B) image pricing
C) market-skimming pricing
D) target pricing
E) markup pricing
Answer: B
Diff: 2
LO: 16.1: How do consumers process and evaluate prices?
AACSB: Application of knowledge
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