Chapter 11

Question 1

new product pricing strategies (2)

Answer 1

market-skimming pricing

market-penetration pricing

Question 2

market-skimming pricing

Answer 2

high initial prices and reduce later on

Question 3

market-penetration pricing

Answer 3

low initial price to attract large number of buyers quickly

Question 4

product mix pricing strategies (5)

Answer 4

1. product line pricing
2. optional product pricing
3. captive product pricing
4. by-product pricing
5. product bundle pricing

Question 5

product line pricing

Answer 5

decide price steps between products in a product line; one product with various class distinctions

Question 6

optional product pricing

Answer 6

offering extras with the product

Question 7

captive product pricing

Answer 7

companies that make products that must be used along with a main product (razor blades)

Question 8

by-product pricing

Answer 8

selling by-product of original product or service

Question 9

product bundle pricing

Answer 9

combining several products and offering the bundle at a reduced price

Question 10

price adjustment strategies (6)

Answer 10

1. discount and allowance pricing
2. segmented pricing
3. psychological
4. promotional
5. geographical pricing
6. dynamic

Question 11

segmented pricing

Answer 11

different prices depending on difference in customers, products, or locations (gym, stadium seats)

Question 12

psychological

Answer 12

Prices as symbols

Question 13

promotional

Answer 13

temporarily reducing prices to increase short-run sales (seasonal sales)

Question 14

geographical pricing

Answer 14

setting prices for customers located in different parts of the country or world

Question 15

dynamic

Answer 15

continuous adjustment based on customers, demand, supply (eBay)