MKT 475 Week 8 Quiz – Strayer
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Quiz
7 Chapter 11 and 12
Chapter
11
Pricing Strategy
True/False
Questions
1. Price
strategy is always related to competition whether firms use a higher, lower, or
equal price.
323
2. Both revenues and costs need to be taken into
account in selecting pricing strategies.
323
3.
Lowering prices generally eliminates potential price wars.
324
4.
The second step in selecting a pricing strategy is analyzing the pricing
situation.
324
5. The
core issue in pricing is finding out what value requirements (benefits-costs)
the buyer places on the product or brand.
327
6. The
underlying logic of economic value modeling (EVM) is that using the
price/benefit ratio is a more realistic view of value than "dollar worth
of benefits minus price."
328
7.
Customer value mapping estimates are based on the differentiated benefits that
a customer receives from a product.
328
8. Competitive
bidding is an example of demand-oriented approach of pricing.
340
9. Reverse
auction pricing involves sellers bidding for organizational buyers’ purchases.
340
10.
The competitor is the frame of reference for demand-oriented pricing methods.
340
Multiple
Choice Questions
11.
Which of the following distribution approaches is most likely to call for more
competitive pricing?
A.
Exclusive
B.
Selective
C.
Intensive
D.
Narrow
321
322
12.
Price cuts in economic downturns are primarily aimed at:
A.
increasing short-term profits.
B.
defending a firm’s position vigorously.
C.
compensating for low quality products.
D.
capturing market share.
323
13.
Which of the following is the first step in selecting a pricing strategy?
A.
Setting pricing objectives
B.
Analyzing the pricing situation
C.
Selecting pricing strategy
D.
Determining specific prices and policies
323
14.
Which of the following is the final step in selecting a pricing strategy?
A.
Setting pricing objectives
B.
Determining specific prices and policies
C.
Selecting pricing strategy
D.
Analyzing the pricing situation
323
15.
_____ is the percentage change in the quantity sold of a brand when the price
changes, divided by the percentage change in price.
A.
Price distribution
B.
Price band
C.
Price point
D.
Price elasticity
327
16.
_____ estimates value as the perceived quality buyers obtain per unit of price.
A.
Customer value mapping
B.
Customer equity
C.
User lifetime value
D.
Customer value proposition
327
328
17.
Value using _____ consists of the financial savings and gains provided to
customers due to purchase of the firm’s brand instead of competitors’ brands.
A.
customer value mapping
B.
economic value modeling
C.
user lifetime value
D.
customer value proposition
328
18.
Which of the following is the first step in cost analysis for pricing
decisions?
A.
Estimating how cost varies with the volume of sales
B.
Analyzing the cost competitive advantage of the product
C.
Determining the components of the cost of the product
D.
Estimating how much control management has over costs
330
19.
_____ indicates whether costs and prices for various products decline by a
given amount each time the number of units produced doubles.
A.
Economic value modeling
B.
Activity-based costing
C.
Customer value mapping
D.
Learning-curve analysis
331
20.
A high-active pricing strategy:
A.
values superiority.
B.
emphasizes nonprice competitive factors.
C.
offers discounts.
D.
avoids price comparisons.
336
21.
Which of the following is true of high-passive strategy pricing?
A.
It is used when competition for the market target is very high.
B.
It emphasizes nonprice competitive factors.
C.
It is primarily used by discount retailers.
D.
It is used by producers whose brands are not familiar to the market.
337
22.
A low-active pricing strategy:
A.
emphasizes nonprice competitive factors.
B.
is mainly used to gain margins in small market targets.
C.
is most effective for discount retailers.
D.
is an attractive strategy when competition for market target is high.
337
23.
A low-passive pricing strategy:
A.
emphasizes superior value of the product.
B.
emphasizes nonprice competitive factors.
C.
offers discounts.
D.
avoids price comparisons.
337
24.
When two or more competitors collude to explicitly or implicitly set prices,
this practice is referred to as _____.
A.
horizontal price fixing
B.
price discrimination
C.
deceptive pricing
D.
predatory pricing
337
25. _____
is the practice of charging different prices to different buyers for goods of
similar grade and quality.
A. Price fixing
B. Price
discrimination
C. Deceptive pricing
D. Predatory pricing
338
26. Charging
a very low price for a product with the intent of driving competitors out of
business is referred to as _____.
A. cannibalization
B. price fixing
C. predatory
pricing
D. deceptive pricing
338
27.
Which of the following types of price determination methods uses the price of
producing and marketing the product as the basis for determining price?
A.
Cost-oriented
B.
Supply-oriented
C.
Competition-oriented
D.
Demand-oriented
339
28. _____
pricing methods consider estimated market response to alternative prices.
A. Cost-oriented
B. Supply-oriented
C. Competition-oriented
D. Demand-oriented
339
29.
Which of the following types of pricing is considered a cost-oriented approach
of pricing?
A.
Break-even pricing
B.
Reverse auction pricing
C.
Demand-oriented pricing
D.
Internet auction pricing
339
30.
When using markup pricing, which of the following formulas determines the
selling price?
A.
Price = Average unit cost divided by Markup percentage
B.
Price = Average unit cost divided by 1 minus Markup percentage
C.
Price = Unit cost minus Markup price
D.
Price = Total fixed costs divided by Unit price minus Unit variable cost
340
Essay
Questions
31. Explain
the role of price in the distribution strategy.
32. Explain
the various roles of price in the marketing program.
33.
What are the steps in selecting a pricing strategy?
34.
Give an account of predatory pricing. What are its ethical implications?
35.
Give an account of the impact of emerging markets on pricing.
Chapter
12
Promotion, Advertising, and Sales
Promotion Strategies
True/False
Questions
1. An advantage of personal
selling over advertising is its flexibility in responding to the buyer’s
objections and questions at the time the decision to purchase is being made.
355
2.
The percent-of-sales method of budgeting for promotion is arbitrary and does
not recognize that promotion efforts and results are related.
357
3. Promotion
expenditures for the competitive parity method are guided by comparing which
component(s) is/are appropriate for attaining each objective.
357
4.
The final step in developing an advertising strategy involves evaluating its
effectiveness.
359
5. Determining
the sales and profit impact of advertising is more difficult to measure than
the exposure and awareness it creates.
360
6.
The fragmentation of many consumer markets is driving significant amounts of
advertising spending from traditional mass media to more focused narrowcast
media.
363
7.
Recall tests measure consumers’ awareness of specific ads and campaigns by
asking questions to determine if a sample of people remembers an ad.
366
8.
Longitudinal studies use empirical data to build a mathematical relationship
between sales and advertising effort.
366
9.
Sales promotions are primarily used to bring awareness of a particular product.
366
10.
Coupons are extensively used as a promotional activity to target value chain
members.
369
Multiple
Choice Questions
11. _____
consists of planning, implementing, and controlling an organization's
communications to its customers and other target
audiences.
A. Promotion strategy
B. Distribution program
C. Benchmarking
D. Planned
obsolescence
350
12.
Which of the following is a disadvantage of advertising?
A.
It has high cost per exposure.
B.
It has fixed messages for the duration of an exposure.
C.
It does not allow much creativity in message design.
D.
It provides low control of message content.
351
13.
Which of the following is true about advertising?
A.
It has high cost per exposure.
B.
It provides low control over exposure.
C.
It does not allow direct interactions with buyer.
D.
It does not allow for creative message designs.
351
14. _____
consists of verbal communication between a salesperson and one or more
prospective purchasers with the objective of making or influencing a
sale.
A. Public relation
B. Sales
promotion
C. Advertising
D. Personal selling
351
15. _____
consists of activities such as, trade shows, contests, samples,
point-of-purchase displays, product placement in films and other occasions,
trade incentives, and coupons.
A. Sales
promotion
B. Advertising
C. Personal selling
D. Interactive
marketing
351
16. _____ refers to
communications placed in the commercial media at no charge to the company
receiving the publicity.
A. Advertising
B. Public
relations
C. Personal selling
D. Interactive marketing
353
17.
Which of the following is a disadvantage of the percent of sales method of
setting promotional budgets?
A.
It heavily relies on the experience and judgment of the marketing team.
B.
It can result in too much spending on promotion when sales are high and not
enough when sales are low.
C.
Its budgeting method is directly guided by how much competitors spend.
D.
It does not base its budgeting on past expenditure patterns.
357
18.
Which of the following promotion strategies is most appropriate when buyers’
information needs are high?
A.
Advertising-driven
B.
Sales promotion-driven
C.
Personal selling-driven
D.
Generic
358
19.
An advertising-driven promotion strategy is used when:
A.
the numbers of buyers are small.
B.
the size and importance of purchase is large.
C.
product complexity is high.
D.
no post purchase contact is required.
358
20.
Which of the following advertising objectives is used more often because of the
ease of measurement?
A.
Exposure objectives
B.
Attitude change objectives
C.
Sales objectives
D.
Profit objectives
360
21.
Distributing promotional video clips across the Internet is referred to as
_____.
A. personal selling
B.
viral marketing
C.
sales promotion
D.
direct distribution
363
22.
_____ identifies relationships between advertising expenditures and sales using
statistical techniques such as regression analysis.
A. Test
marketing
B. Recall test
C. Longitudinal study
D. Evaluating
historical data
366
23. _____
measure(s) consumers' awareness of specific ads and campaigns by asking
questions to determine if a sample of people remembers an
ad.
A. Recall tests
B. Effort/result models
C. Longitudinal studies
D. Test marketing
366
24. _____
track(s) advertising expenditures and sales results before, during, and after
an advertising campaign.
A. Effort/result
models
B. Longitudinal studies
C. Recall tests
D. Test marketing
366
25. _____
use empirical data to build a mathematical relationship between sales and
advertising effort.
A. Controlled tests
B. Recall
tests
C. Effort/results models
D. Longitudinal studies
366
26.
Which of the following is a promotional pricing form of sales promotion
activity?
A.
Selling aids
B.
Trade shows
C.
Prizes
D.
Coupons
369
27.
Which of the following sales promotion activity is targeted at industrial
buyers?
A.
Coupons
B.
Bonuses
C.
Rebates
D.
Advertising support
369
28.
Which of the following informational activities is targeted at both channel
members and the salesforce?
A.
Demonstrations
B.
Trade shows
C.
Displays
D.
Selling aids
369
29.
Which of the following is a disadvantage of sales promotions?
A.
The sales response of the sales promotion activities cannot be measured to
determine their effectiveness.
B.
The incentive and price promotion techniques trigger the purchase of other
products.
C.
It allows value-added resellers to build inventories on products that receive
manufacturers’ trade discounts.
D.
It has the flexibility to contribute to various marketing objectives.
370
30.
Which of the following is the first step in developing a sales promotion
strategy?
A.
Setting specific promotion objectives
B.
Defining the communications task(s) to be accomplished
C.
Evaluating the relative cost-effectiveness of various methods
D.
Coordinating the content and the timing with other activities
371
Essay
Questions
31. Identify
the advantages and disadvantages of advertising.
32.
List the activities involved in designing an organization’s promotion strategy.
33.
Define and explain the benefits of the objective and task method of promotion
budget.
34.
Explain the challenges impacting the creative process in advertising and
changing the design of creative strategies and media.
35.
Give an account of the different promotional activities targeted at a firm’s
salesforce.
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