Customers today want separate prices for each service element and they also want the right to select the elements they want. The customers are said to be pressing for _____ services.
The zone of __________ is a range where a service dimension is deemed satisfactory, anchored by the minimum level consumers are willing to accept and the level they believe can and should be delivered.
Services high in __________ qualities have characteristics that the buyers can evaluate before purchase.
Companies may wish to implement a(n) __________ to achieve more growth, to realize higher margins, or simply to position themselves as full-line manufacturers.
a) up-market stretch
b) rebranding plan
c) outsourcing strategy
d) disintermediation policy
How a consumer shops for organic foods and how he or she uses and disposes of the product is part of the consumers’ __________ that is important for marketers to consider.
a) value proposition
b) consumption system
c) value system
d) quality perception
The way the user performs the tasks of getting and using products and related services is the user’s total _____ system.
c) consistent use
A customer judges a product offering by three basic elements: product features and quality, services mix and quality, and:
A consumer products firm manufactures and sells over 200 different sizes and varieties of jams and jellies. We can say that this manufacturer’s product mix has high:
Josh gets his bike serviced at Dean’s Garage even though there’s another garage much closer to home. He prefers Dean’s because the work is usually done quickly and the staff tries to solve the issues with the bike as soon as possible. Dean’s Garage excels at which of the following five determinants of service quality?
Marketers have traditionally classified products on the basis of three characteristics: __________, tangibility, and use.
Regular maintenance and repair costs are known as _____ costs.
a) service contract
d) facilitating services
Cocktail lounges in restaurants are examples of:
a) differential pricing.
b) cultivating nonpeak demand.
c) complementary services.
d) reservation systems.
Which of the following is an example of a hybrid service?
c) Restaurant meal
Which of the following is a benefit of product mapping?
a) Studying market matrices
b) Integrating target markets
c) Identifying market segments
d) Educating consumers
The __________ of the product mix refers to the total number of items in the mix.
Capital items are long-lasting goods that facilitate developing or managing the finished product. They include two groups:
a) installations and natural products.
b) installations and component materials.
c) installations and operating supplies.
d) installations and equipment.
Unlike physical products, services cannot be seen, tasted, felt, heard, or smelled before they are bought. This is known as the __________ aspect of services.
Services high in __________ qualities are those services that have characteristics the buyer normally finds hard to evaluate even after consumption.
The __________ rates the various elements of the service bundle and identifies required actions.
a) company performance analysis
b) voice of customer measurement
c) customer factor measurement
d) importance-performance analysis
Industrial goods can be classified as __________, capital items, or suppliers and business services based on their relative cost and how they enter the production process.
a) service components
d) materials and parts
Lesson 7 Exam
In __________ pricing, the firm bases its price largely on competitors’ prices.
__________ price refers to what the consumers feel the product should cost.
c) Usual discounted
While shopping at the mall, Jane is asked by one of the sales representatives at the cosmetics counter to try out a new lipstick that her company is test marketing. The company representative asks her how much she would be willing to pay for the lipstick. After trying it out, Jane is of the opinion that $5 is just the right price for it. What type of a reference price is Jane using?
a) Usual discounted price
b) Fair price
c) Maximum retail price
d) Last price paid
Which of the following is the first step in setting a pricing policy?
a) Selecting a pricing method
b) Selecting the pricing objective
c) Determining demand
d) Estimating cost
A firm that is plagued with overcapacity, intense competition, or changing wants would do better if it pursues __________ as its major objective.
a) market skimming
b) product-quality leadership
d) profit maximization
__________ auctions let would-be suppliers submit only one bid; they cannot know the other bids.
a) Descending bid
When consumers examine products, they often compare an observed price to an internal price they remember. This is known as a(n) __________ price.
Deducting the desired profit margin from the price at which a product will sell, given its appeal and competitors’ prices, is known as:
a) overhead costing.
b) target costing.
c) activity based costing.
d) benefit analysis.
The key to perceived-value pricing is to:
a) reengineer the company’s operations.
b) deliver more unique value than competitors.
c) adopt subtle marketing tactics compared to competitors.
d) deliver more value but at a lower cost.
Which of the following is TRUE regarding price elasticity?
a) The higher the elasticity, the lesser is the volume growth resulting from a 1 percent price reduction.
b) Within the price indifference band, price changes have little or no effect on demand.
c) If demand is elastic, sellers will consider increasing the price.
d) Price elasticity does not depend on magnitude and direction of the contemplated price change.
Many consumers are willing to pay $100 for a perfume that contains $10 worth of scent because the perfume is from a well-known brand. What kind of a pricing is the company depending on?
a) Going-rate pricing
b) Image pricing
c) Market-skimming pricing
d) Target pricing
A manufacturer has invested $750,000 in a new product and wants to set a price to earn a 15 percent ROI. The cost per unit is $18 and the company expects to sell 50,000 units in the first year. Calculate the company’s target-return price for this product.
__________ cost is the cost per unit at that level of production.
When a company introduces a product at a very high price and then gradually drops the price over time, it is pursuing a __________ strategy.
a) market-penetration pricing
b) market-skimming pricing
d) switching cost
The decline in the average cost of production with accumulated production experience is called the:
a) demand curve.
b) supply chain.
c) learning curve.
d) value chain.
If demand changes considerably with a small change in price, the demand is said to be:
a) unit elastic.
Costs that differ directly with the level of production are known as _____ costs.
A market-penetration pricing strategy is most suitable when:
a) a low price slows down market growth.
b) production and distribution costs fall with accumulated production experience.
c) a high price dissuades potential competitors from entering the market.
d) the market is characterized by inelastic demand.
Companies that believe that a higher sales volume leads to lower unit costs and higher long-run profits are attempting to:
a) maximize their market share.
b) skim the market.
c) become a product-quality leader.
d) merely survive in the market.
A company must make payments each month for rent, heat, interest, and salaries. These are _____ costs.