Marketing, 14e (Kerin)
1) The largest U.S.-based TV maker is
A) Sharp.
B) Panasonic.
C) LG.
D) Sony.
E) VIZIO.
2) VIZIO is the market leader in the North American ________ market.
A) designer eyewear
B) virtual media
C) smart TV
D) 3-D video game
E) exotic travel
3) VIZIO’s HDTVs are sold through all of the following types of retailers except which?
A) Amazon.com
B) mass merchandisers, such as Target
C) its own brick-and-mortar stores
D) wholesale club stores such as Sam’s Club
E) electronics stores such as Best Buy
4) In order to deliver a product that the average consumer can afford, VIZIO
A) handles product design and marketing in the United States and relies on contract
manufacturers in other countries to build the product.
B) uses mass customization in other countries and then ships the HDTVs to the United States.
C) purchased a small company in China to distribute its products under the VIZIO name.
D) purchased a small company in Japan to distribute its products under the VIZIO name.
E) relies solely on recycled materials to build high-quality, no-frills products.
5) Price refers to
A) the value assigned to the exchange of products and services for other products and services.
B) the value judgment made by both the buyer and seller regarding an item’s worth.
C) the money or other considerations (including other products and services) exchanged for the
ownership or use of a product or service.
D) the value assessed for the benefits of using a product or service.
E) the highest monetary value a customer is willing to pay for a product or service.
6) From a marketing viewpoint, ________ is the money or other considerations (including other
products and services) exchanged for the ownership or use of a product or service.
A) value
B) price
C) barter
D) currency
E) a tariff
7) All of the following are alternate names for price except which?
A) a premium
B) barter
C) tuition
D) a commission
E) profit
8) Which of the following is an example of a price?
A) college tuition
B) operating costs
C) liquidity
D) value
E) stockholders’ equity
9) Insurance premiums, entrance fees, train fares, and organization dues are all examples of
A) charges.
B) barter.
C) profit.
D) price.
E) outlays.
10) All of the following statements about price are true except which?
A) Small changes in price can have big effects on both the number of units sold and company
profit.
B) The price for a product or service must earn a profit for the company.
C) For most products and services, there is an agreed-upon price range set by makers.
D) The price must be “right”—in the sense that customers must be willing to pay it.
E) The price must generate enough sales dollars to pay for the cost of developing, producing, and
marketing the product.
11) Susan hired an attorney to represent her in a court case involving an auto accident. The
attorney charged her a $2,000 retainer fee for the services. Terry needed a haircut; the local
stylist charged him $12 for his services. Aaron mowed his neighbor’s lawn; in exchange, the
neighbor repaired his gutters. The attorney fees, the $12 charged by the hair stylist, and the
exchange of lawn mowing for gutter repair are all examples of
A) premiums.
B) barter.
C) the profit motive.
D) price.
E) outlays.
12) The practice of exchanging products and services for other products and services rather than
for money is referred to as
A) barter.
B) reciprocal pricing.
C) virtual pricing.
D) balance of payments.
E) value-pricing.
13) Barter refers to
A) a reciprocity agreement stipulating that if company A purchases services from company B,
then company B must purchase similar services from company A.
B) a tying agreement stipulating that if company A purchases a product from company B, it must
also purchase one of its services.
C) the practice of exchanging products and services for other products and services rather than
for money.
D) the practice of exchanging services for products of equal or greater value.
E) the practice of exchanging products and services for money.
14) Barter is the practice of exchanging products and services for other products and services
rather than for
A) value.
B) ideas.
C) promises.
D) tariffs.
E) money.
15) The use of “special fees” and “surcharges” is driven by consumers’ zeal for ________
combined with the ease of making price comparisons on the Internet.
A) readily accessible information
B) low prices
C) quality
D) value
E) warranties
16) According to the price equation, final price equals list price minus ________ plus extra fees.
A) profits
B) commissions
C) trade-ins
D) taxes
E) incentives and allowances
17) According to the price equation, final price equals ________ minus incentives and
allowances plus extra fees.
A) salaries
B) list price
C) profits
D) trade-ins
E) taxes
18) According to the price equation, a product’s or service’s final price equals its list price minus
incentives and allowances plus
A) profits.
B) commissions.
C) trade-ins.
D) extra fees.
E) taxes.
19) A company that manages apartments decides to buy 15 new dishwashers at a list price of
$550 each as replacements for old dishwashers in a small apartment complex it owns. Because
the company is buying more than 10 dishwashers, it is eligible for a $150-per-unit quantity
discount. Financing charges total $20 per unit. The company gets $10 per dishwasher for the 15
dishwashers traded in. What is the final price the company will pay for each dishwasher?
A) $390
B) $400
C) $410
D) $430
E) $730
20) Tara is enrolled for spring semester at college. The tuition is $6,000, but she has a
scholarship for $1,000 as well as a work-study grant of $1,500. The health fees and student
activity fees are $150 for the semester. What is the final price that Tara will pay for the spring
semester?
A) $2,500
B) $2,650
C) $3,150
D) $3,650
E) $6,150
21) Suppose you want to buy a Tesla Model S, the world’s leading all-electric, zero-emission car
that has a 265-mile range and can be recharged in three hours. The Tesla Model S Performance
model has a list price of $87,500. However, you want several options (Performance Plus
Package, red multicoat armor paint, Tech Package, Sound Studio Package, home charging
station, performance wheels, and others) that will cost $17,500. An extended warranty will add
an additional $5,000. However, if you put $50,000 down now and finance the balance over the
next year, you will receive a dealer rebate of $5,000 off the list price. The dealer will give you a
$7,000 trade-in allowance for your 2010 Honda Civic DX four-door sedan. In addition, you will
have to pay a state sales tax of $10,000, an auto registration fee of $1,000 to the state, and a
$1,000 destination charge to ship and prep the car. But because the Tesla Model S is an
alternative energy vehicle, you qualify for a $2,500 state rebate and a $7,500 federal tax credit!
Finally, your total finance charge is $7,000. Applying the price equation, what is your final price
for the Tesla Model S?
A) $57,000
B) $68,000
C) $87,500
D) $107,000
E) $151,000
22) The ratio of perceived benefits to price is referred to as
A) the price-quality relationship.
B) customer-value pricing.
C) value-added pricing.
D) value analysis.
E) value.
23) The ratio of ________ to price is referred to as value.
A) prestige rating
B) perceived benefits
C) costs
D) anticipated quality
E) profits
24) The ratio of perceived benefits to ________ is referred to as value.
A) price
B) prestige
C) perceived quality
D) profits
E) discounts
25) To increase value the most, marketers should
A) decrease benefits.
B) decrease benefits and increase price.
C) decrease price and increase benefits.
D) decrease price and decrease benefits.
E) hold the price steady and let the perceived value of the item increase as it matures in its life
cycle.
26) To increase value, marketers may ________, decrease price, or do both.
A) decrease promotion
B) increase benefits
C) decrease distribution
D) increase advertising
E) allow the perceived value of the item to increase as it matures in the life cycle
27) Which of the following statements is most accurate?
A) For some products, price influences the perception of overall quality, and ultimately value, to
consumers.
B) A consumer’s view of a product’s value depends almost entirely on external assessments of
quality.
C) A consumer’s view of value is a function of his or her education and income.
D) Price plays only a small part in a consumer’s perceived value of a product or service.
E) Price plays a large role in assessing value but a very minor role in assessing quality.
28) Most consumers realize that the quality of diamonds varies, and most believe the higher the
price of a diamond, the higher its quality. This is an example of price influencing the perception
of overall quality and therefore ________ to consumers.
A) acceptable cost
B) perceptual investment
C) barter potential
D) return on investment
E) value
29) When Pizza Hut announced it was going to add 25 percent more toppings to its Meat Lover’s
line of pizzas without increasing prices, consumers benefited from an increase in what?
A) cost
B) appearance
C) value
D) price
E) quality
30) Value pricing refers to
A) the ratio of perceived benefits to price.
B) the money or other considerations exchanged for the ownership or use of a product or service.
C) the practice of simultaneously increasing product and service benefits while maintaining or
decreasing price.
D) the ratio of price to perceived benefits.
E) list price minus incentives and allowances plus extra fees.
31) The practice of simultaneously increasing product and service benefits while maintaining or
decreasing price is referred to as
A) value pricing.
B) customer-value pricing.
C) competitive pricing.
D) cost pricing.
E) demand pricing.
32) Marketers may engage in value pricing, which is the practice of simultaneously ________
while maintaining or decreasing price.
A) promoting specific product and service benefits
B) increasing product and service benefits
C) decreasing profit
D) analyzing benefits
E) decreasing cost
33) A major grocery chain pays its baggers a regular hourly wage. The baggers not only pack the
groceries, but they also will take customers’ groceries to their car, regardless of the weather. The
baggers are not permitted to accept tips, even if they are offered. The consumer will experience
this as
A) pricing enhancement.
B) societal pricing.
C) revenue sharing.
D) value pricing.
E) cost-plus pricing.
34) Many cosmetology schools allow their advanced students to style hair for “real-world”
clients for a reduced fee. The students benefit from the experience, the clients get a less
expensive haircut, and the school is able to provide students with additional training without it
costing anything; in fact, they even profit from it. This is an example of
A) value pricing.
B) societal pricing.
C) revenue sharing.
D) barter.
E) cost-assist pricing.
35) If a McDonald’s menu board advertises Mini Meals under $3, McDonald’s is most likely
using which type of pricing strategy?
A) predatory pricing
B) value pricing
C) loss-leader pricing
D) odd-even pricing
E) barter
36) A reference value involves comparing the costs and benefits of
A) substitute items.
B) items of equal or greater value.
C) products with which a consumer is familiar and items the consumer has not seen or used
before.
D) items from one particular manufacturer or distributor.
E) intangible items.
37) A reference value is developed by the consumer through
A) considering the amount of time and energy a consumer puts into the purchase process.
B) judging the value assigned to similar items used by the consumer’s peers.
C) performing a careful break-even analysis.
D) comparing the costs and benefits of substitute items.
E) examining the true difference between customers’ “needs” and “wants.”
38) In the purchase of the sugar substitute Splenda, you may compare it to something you know
about like real sugar. Although Splenda is more expensive than sugar, it is purchased by many
consumers because it contains no calories. This situation involves the consumer considering
A) a marginal analysis.
B) a profit equation.
C) a break-even analysis.
D) price elasticity of demand.
E) a reference value.
39) If you know the contents and price of a McDonald’s Extra Value Meal, it may serve as
________ to you when you visit other fast-food restaurants and consider the purchase of a meal
option there.
A) a marginal analysis
B) a profit equation
C) a reference value
D) a break-even analysis
E) price elasticity of demand