Chapter 10

Question 1

A pricing strategy in which a firm decides to price at some market average price in context with prices of competitors

Answer 1

Competitor Based Pricing

Question 2

A pricing strategy in which a firm attempts to take into account the role of price as it reflects the bundle of benefits sought by the customer

Answer 2

Value Pricing

Question 3

A pricing tactic in which a firm affords the marketing manager an opportunity to develop a rational pricing approach across a complete line of related items

Answer 3

Product line pricing

Question 4

A pricing tactic of gaining a commitment from a customer to a basic product or system that requires continual purchase of peripherals to operate

Answer 4

Captive pricing

Question 5

A pricing tactic in which customers are given the opportunity to purchase a package deal at a reduced price compared to what the individual components of the package would cost separately

Answer 5

Price bundling

Question 6

A pricing strategy in which a firm gives customers comparative prices when considering purchase of a product so they are not viewing a price in isolation from prices of other choices

Answer 6

Reference pricing

Question 7

A pricing tactic that lends prestige to a product or brand by virtue of a price relatively higher than the competition

Answer 7

Prestige pricing

Question 8

A pricing tactic in which the price marked on a good is what it typically sells for

Answer 8

One-price strategy

Question 9

A pricing tactic in which customers are allowed or encouraged to haggle about prices

Answer 9

Variable pricing

Question 10

A pricing tactic that entails relatively low, constant prices and minimal spending on promotional efforts

Answer 10

Everyday low pricing

Question 11

A pricing strategy in which the retailer offers frequent discounts, primarily through sales promotions, to stated regular prices

Answer 11

High/low pricing

Question 12

A pricing tactic in which individuals competitively bid against each other and the purchase goes to the highest bidder

Answer 12

Auction pricing

Question 13

A pricing decision made by considering fixed costs and then demand forecasting to determine the price per unit

Answer 13

Target-return pricing

Question 14

A pricing decision made by identifying all costs associated with an offering to come up with what the average cost of a single unit should be

Answer 14

Average-cost pricing

Question 15

A percentage discount off invoice to elicit quicker payment by the customer

Answer 15

Cash discounts

Question 16

An incentive to a channel member for performing some function in the channel that benefits the seller

Answer 16

Trade discounts

Question 17

Discounts taken off an invoice price based on different levels of product purchased

Answer 17

Quantity discounts

Question 18

Discounts that reward the purchaser for shifting part of the inventory storage function away from the manufacturer

Answer 18

Seasonal discounts

Question 19

Sales promotions initiated by the manufacturer and carried out by the retailer, who is then compensated by the manufacturer

Answer 19

Promotional allowances

Question 20

When the same delivery fee is charged to customers regardless of geographic location within a set area

Answer 20

Uniform delivered pricing