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2007 Chapter 11 Test

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2007 Chapter 11 Test Powered By Docstoc
					 #                       Question                        Answer
1    The ____of prices can vary due to many
     circumstances
2    If you purchase a certain amount of
     products from the store, you will receive
     a(an)___quantitu discount.
3    There are many___considerations to
     consider when setting the price for a
     product.
4    He wanted his new product to be ___so he
     built it with quality materials.
5    There is a ___ that higher priced items are
     better quality
6    Sometimes ___ from your pricing plan will
     have to be made based on changing market
     conditions.
7    You should try to set the price of your
     product at the exact level the market will
8    She negotiated a(n)___arrangement with
     the manufacturer so she would be the only
     dealer selling the item.
9    The price of baseball trading cards
     is/are___because the price changes with
     demand.
10   It makes no sense to ____ over a price for
     an item that is inelastic.
Word Bank for questions 1-10 above
Perception sensitivity elastic bear enduring        ethical   haggle
Deviations exclusive        cumulative

Questions 11-20 are true and false
11   Psychological pricing, prestige pricing, and
     price lining are all promotional pricing
     techniques.
12   Odd/even pricing uses odd prices (39.95) to
     suggest higher quality andeven prices
     ($40.00) to suggest bargains.
13   Price skimming involves charging a high initial
     price for new products to recover cost or
     maximize profits as soon as possible.
14   Penetration pricing attempts to build sales
     volume by charging lower initial prices.
15   Break-even point occurs when sales equal
     costs minus the expenses of making or
     distributing a product.
16   Markup is the amount added to the cost of
     an item to cover expenses and ensure profit.
17   Markdown means a business lowers its prices
     by a certain percentage.
18   A discount is a reduction in price to the
     customer.
19   Special market circumstances such as a heat
     wve provide an opportunity for permanent
     increases in prices for some businesses.
20   Changes in price strategy should be made as
     a result of periodic systematic review.

				
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