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.   prevent manufacturers from taking high markups.
B.   eliminate price competition on manufacturers' brands.
C.   require some minimum percentage markup on cost.
D.   permit different types of retail outlets to charge different retail prices.
E.   guarantee retailers some profit.
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.   one-price
B.   skimming price
C.   flexible-price
D.   target-return pricing
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.   one-price
B.   penetration pricing
C.   flexible-price
D.   value pricing
E.     
F.   skimming price
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.   truth-in-advertising law.
B.   price-fixing law.
C.   price discrimination law.
D.   antidumping law.
E.   monopoly law.
Question #5
Price fixing is illegal under all circumstances in the United States.
A.   TRUE
B.   FALSE
Question #6
Noncumulative quantity discounts
A.   are never attractive to buyers.
B.   tie a buyer to the seller after a single purchase.
C.   apply only to individual orders.
D.   are designed to primarily encourage repeat buying.
E.   reduce the customer's cost for additional purchases.
Question #7
Price fixing is not illegal unless it hurts a competitor.
A.   TRUE
B.   FALSE
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.   TRUE
B.   FALSE
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.   1,000,000
B.   1,200,000
C.   2,890,000
D.   189,000
E.   This cannot be determined with the information provided.
Question #12
Prestige pricing involves setting a rather high price because the product has a normal down-sloping demand curve.
A.   FALSE
B.   TRUE
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.   TRUE
B.   FALSE
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.   depreciation
B.   insurance
C.   property taxes
D.   rent
E.   component parts
Question #17
Marginal analysis
A.   can be used to find the most profitable price and quantity. And focuses on the last unit that will be sold.
B.   focuses on the last unit that will be sold.
C.   All of the answers are correct.
D.   can help find the price that results in the greatest difference between total revenue and total cost.
E.   can be very useful if a firm's pricing objective is profit maximization.
F.   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.
Question #18
When Best Buy advertises one price for the cost of a computer and a monitor, it is using
A.   complementary product pricing.
B.   a one-price policy.
C.   bait pricing.
D.   product-bundle pricing.
E.   flexible 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 this is a government requirement.
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 they are likely to have similar operating expenses.
E.   They are likely to use the same markup percentage, because they all want to have the same selling price.
Question #20
The break-even point is the intersection of the total cost curve and the total profit curve.
A.   FALSE
B.   TRUE

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