COB 300 Marketing Midterm 2 Exam
questions Correct Verified Answers
(A+ Pass)
Considerations for Setting Price Strategies - Answers -✔✔ A. Cost-Based Methods
B. Competition-Based Methods
C. Value-Based Pricing Methods
Cost-Based Methods - Answers -✔✔ determine the final price to charge by starting
with the cost
Competition-Based Methods - Answers -✔✔ Set prices to signal information of how
product compares with competitors
Value-Based Pricing Methods - Answers -✔✔ approaches to setting prices that focus
on the overall value of the product offering as perceived by the consumer
Improvement Value Method - Answers -✔✔ represents an estimate of how much more
(or less) consumers are willing to pay for a product relative to other comparable
products
Cost of Ownership Method - Answers -✔✔ A value-based method for setting prices
that determines the total cost of owning the product over its useful life.
Implementing Value-Based Pricing Methods - Answers -✔✔ Sellers must know how
consumers in different market segments will attach value to benefits delivered by their
products.
Perceived Value
Everyday Low Pricing (EDLP) - Answers -✔✔ setting prices lower than competitors and
then not having any special sales
high/low pricing - Answers -✔✔ a pricing strategy that relies on the promotion of sales,
during which prices are temporarily reduced to encourage purchases
Markdowns - Answers -✔✔ reductions retailers take on the initial selling price of the
product or service
Quantity Discounts for Consumers - Answers -✔✔ size discount, the more you buy the
cheaper the unit cost
Seasonal Discounts - Answers -✔✔ discounts offered to encourage buyers to buy
earlier than present demand requires
Coupons - Answers -✔✔ written price reductions used to encourage consumers to buy
a specific product
Rebates - Answers -✔✔ refunds paid to consumers after a purchase
Leasing/Rentals - Answers -✔✔ consumers pay a fee to purchase the right to use a
product for a specific amount of time
Price Bundling - Answers -✔✔ marketing two or more products in a single package for
a special price
Leader Pricing - Answers -✔✔ setting some very low prices - real bargains - to get
customers into retail stores
Price Lining - Answers -✔✔ the practice of offering a product line with several items at
specific price points
Business Pricing Tactics and Discounts - Answers -✔✔ 1. Seasonal Discounts
2. Cash Discounts
3. Allowances
4. Quantity Discounts
5. Uniform Delivered versus Zone Pricing
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