Marketing 3023 - Marketing Fundamentals » Winter 2021 » Quiz 7

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Question #1
A main purpose of unfair trade practice legislation is to
A.   permit different types of retail outlets to charge different retail prices.
B.   guarantee retailers some profit.
C.   require some minimum percentage markup on cost.
D.   prevent manufacturers from taking high markups.
E.   eliminate price competition on manufacturers' brands.
Question #2
A business products producer that has given its salespeople the right to adjust prices when necessary to get new business is using a ________ policy.
A.   skimming price
B.   target-return pricing
C.   one-price
D.   flexible-price
E.   penetration pricing
Question #3
Offering the same price to all customers who purchase products under essentially the same conditions and in the same quantities is a ________ policy.
A.   skimming price
B.   penetration pricing
C.   flexible-price
D.   one-price
E.   value pricing
F.     
Question #4
If a manufacturer in China offers a product in the U.S. market at a lower price than in China, this may be a violation of a(n)
A.   price discrimination law.
B.   monopoly law.
C.   antidumping law.
D.   price-fixing law.
E.   truth-in-advertising law.
Question #5
Price fixing is illegal under all circumstances in the United States.
A.   FALSE
B.   TRUE
Question #6
Noncumulative quantity discounts
A.   are never attractive to buyers.
B.   reduce the customer's cost for additional purchases.
C.   are designed to primarily encourage repeat buying.
D.   tie a buyer to the seller after a single purchase.
E.   apply only to individual orders.
Question #7
Price fixing is not illegal unless it hurts a competitor.
A.   FALSE
B.   TRUE
Question #8
The price paid by students to colleges is called tuition.
A.   TRUE
B.   FALSE
Question #9
In mature markets, there is downward pressure on both prices and profit margins. In this situation, retailers often have to set prices to meet the competition.
A.   FALSE
B.   TRUE
Question #10
Pricing a product sold in a foreign market lower than the cost of producing it is called dumping.
A.   TRUE
B.   FALSE
Question #11
You are considering opening a fast-food store. Your fixed costs for the required land, building, parking lot paving, kitchen equipment, and neon sign will be $1,000,000. The variable cost will be $1.89 for servings, which will sell for $2.89. How many servings must you sell to break even?
A.   1,200,000
B.   1,000,000
C.   2,890,000
D.   This cannot be determined with the information provided.
E.   189,000
Question #12
Prestige pricing involves setting a rather high price because the product has a normal down-sloping demand curve.
A.   TRUE
B.   FALSE
Question #13
Online auctions (on the Internet) are becoming very popular as a way to determine how much customers are willing to pay for a product.
A.   TRUE
B.   FALSE
Question #14
A markup is the dollar amount added to the cost of products to get the selling price.
A.   FALSE
B.   TRUE
Question #15
A firm's total cost increases only when its variable cost increases.
A.   TRUE
B.   FALSE
Question #16
Which of the following would not be included in a producer's total fixed cost?
A.   insurance
B.   depreciation
C.   property taxes
D.   component parts
E.   rent
Question #17
Marginal analysis
A.   All of the answers are correct.
B.   can be used to find the most profitable price and quantity, can help find the price that results in the greatest difference between total revenue and total cost, can be very useful if a firm's pricing objective is profit maximization and focuses on the last unit that will be sold.
C.   can be very useful if a firm's pricing objective is profit maximization.
D.   can be used to find the most profitable price and quantity. And focuses on the last unit that will be sold.
E.   can help find the price that results in the greatest difference between total revenue and total cost.
F.   focuses on the last unit that will be sold.
Question #18
When Best Buy advertises one price for the cost of a computer and a monitor, it is using
A.   flexible pricing.
B.   a one-price policy.
C.   bait pricing.
D.   complementary product pricing.
E.   product-bundle pricing.
Question #19
Which of the following is true of the markup used by different firms in the same line of business?
A.   They are likely to use the same markup percentage, because they all want to have the same selling price.
B.   They are likely to use the same markup percentage, because this is what is acceptable to manufacturers.
C.   They are likely to use the same markup percentage only if they are in pure competition.
D.   They are likely to use the same markup percentage, because this is a government requirement.
E.   They are likely to use the same markup percentage, because they are likely to have similar operating expenses.
Question #20
The break-even point is the intersection of the total cost curve and the total profit curve.
A.   TRUE
B.   FALSE

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