1."Stockturn
rate" means:
A)the
rate at which products enter and leave a intermediary's establishment.
B)the
number of days required to sell a given output of products.
C)the
number of times the average inventory is sold in a year.
D)the
amount of time needed to sell every item in a retailer's inventory.
E)all
of the above.
2.Future
Shop sets its prices below other electronics stores in its service area
and generally attracts more customers than the others. Future Shop apparently
hopes to earn a profit by:
A)being
the price leader in an oligopoly market.
B)achieving
a high stockturn rate.
C)relying
on a high margin percent.
D)achieving
status quo pricing objectives.
E)setting
prices based on "value in use."
3.Total
fixed cost:
A)is
the sum of all costs of manufacturing and distributing a product.
B)would
be zero if the quantity produced were zero.
C)may
vary in the short run—but is more or less fixed in the long run.
D)is
the sum of all expenses which are closely related to output.
E)is
the sum of those costs that do not change in total no matter how much is
produced.
4.The
sum of those costs that do not change in total—no matter how much is produced—is
called:
A)total
cost.
B)total
variable cost.
C)total
fixed cost.
D)total
direct cost.
E)both
B and C.
5.The
sum of those changing expenses which are closely related to output is called:
A)total
cost.
B)total
average cost.
C)total
fixed cost.
D)total
variable cost.
E)Both
B and D are correct.
6.Break-even
charts usually assume that:
A)any
quantity can be sold at the assumed price.
B)total
cost and total revenue curves are straight lines.
C)the
break-even point is reached when total cost just equals total revenue.
D)average
variable cost is constant per unit.
E)All
of the above are true.
7.Break-even
analysis can show:
A)which
prices will not be profitable.
B)when
a firm should cut its price to increase sales.
C)how
the firm's variable cost per unit will drop as output rises.
D)the
firm's most profitable output level.
8.Some
retailers use certain prices more often than other prices. They seem to
assume that their customers will buy less for a while as prices are lowered—and
then more when some "magic" price is approached. This is:
A)prestige
pricing.
B)psychological
pricing.
C)leader
pricing.
D)odd-even
pricing.
E)demand-backward
pricing.
9.The
idea that people will pay extra for "quality" and status is the idea behind
A)prestige
pricing.
B)psychological
pricing.
C)penetration
skimming.
D)price
lining.
E)average
cost approaches to pricing.
10.Which
of the following pricing approaches should be used by a profit-oriented
retailer if its demand curve is down-sloping to the right for awhile—but
then actually bends back to the left at lower prices?
A)Bait
pricing
B)Penetration
pricing
C)Average-cost
pricing
D)Psychological
pricing
E)Prestige
pricing
11.When
Nintendo sets a relatively low price on its game units to stimulate more
demand and beat the competition for SONY's PlayStation, it is using:
A)bait
pricing.
B)cost
plus pricing.
C)price
lining.
D)complementary
product pricing.
E)product-bundle
pricing.
12.When
Nintendo sets a relatively low price on its game units to stimulate more
demand for its Nintendo game cartridges, it is using:
A)bait
pricing.
B)cost
plus pricing.
C)price
lining.
D)complementary
product pricing.
E)product-bundle
pricing.