MKT 300 Exam 4 Eaton ASU UPDATED
QUESTIONS AND CORRECT ANSWERS
Price - CORRECT ANSWER the value that you exchange for the benefits of having or
using the product/service
Value = - CORRECT ANSWER benefits - costs
Internal factors on pricing decisions - CORRECT ANSWER marketing objectives,
marketing mix strategy, costs
Marketing objectives - CORRECT ANSWER to maximize profit
To gain market share
To infer a level of quality
To survive
Marketing mix strategy - CORRECT ANSWER Price needs to be consistent with other
3P's (needs to reflect advertising, etc.)
Costs - CORRECT ANSWER your costs affect your profit, so set the optimal price
External factors on pricing decisions - CORRECT ANSWER demand for your product,
competition, economy
Competition - CORRECT ANSWER competitor's prices
Strength of competition
Economy - CORRECT ANSWER cost of components (natural resources)
Economic conditions
, Price elasticity - CORRECT ANSWER tells us how much the demand for a product
will change with a change in price (% change in quantity demanded/% change in price)
Elastic demand - CORRECT ANSWER a relatively small decrease in price results in a
substantial increase in quantity demanded
Inelastic demand - CORRECT ANSWER a relatively large increase in price results in
only a small decrease in quantity demanded
Unitary elasticity - CORRECT ANSWER an increase in sales exactly offsets a
decrease in prices and revenue is unchanged
Importance of price - CORRECT ANSWER type of product, type of target market,
purchase situation
Profit - CORRECT ANSWER identify price and cost levels that allow the firm to
maximize profit per product
Status quo - CORRECT ANSWER identify price levels similar to competitor average
price
Market share - CORRECT ANSWER adjust price levels so that the firm can maintain
or increase sales relative to competitors' sales
Sources of competitors pricing information - CORRECT ANSWER -comparative
shoppers
Importance of knowing competitors prices - CORRECT ANSWER -Helps determine
how important price will be to customers
-Helps marketers in setting competitive prices for their products
QUESTIONS AND CORRECT ANSWERS
Price - CORRECT ANSWER the value that you exchange for the benefits of having or
using the product/service
Value = - CORRECT ANSWER benefits - costs
Internal factors on pricing decisions - CORRECT ANSWER marketing objectives,
marketing mix strategy, costs
Marketing objectives - CORRECT ANSWER to maximize profit
To gain market share
To infer a level of quality
To survive
Marketing mix strategy - CORRECT ANSWER Price needs to be consistent with other
3P's (needs to reflect advertising, etc.)
Costs - CORRECT ANSWER your costs affect your profit, so set the optimal price
External factors on pricing decisions - CORRECT ANSWER demand for your product,
competition, economy
Competition - CORRECT ANSWER competitor's prices
Strength of competition
Economy - CORRECT ANSWER cost of components (natural resources)
Economic conditions
, Price elasticity - CORRECT ANSWER tells us how much the demand for a product
will change with a change in price (% change in quantity demanded/% change in price)
Elastic demand - CORRECT ANSWER a relatively small decrease in price results in a
substantial increase in quantity demanded
Inelastic demand - CORRECT ANSWER a relatively large increase in price results in
only a small decrease in quantity demanded
Unitary elasticity - CORRECT ANSWER an increase in sales exactly offsets a
decrease in prices and revenue is unchanged
Importance of price - CORRECT ANSWER type of product, type of target market,
purchase situation
Profit - CORRECT ANSWER identify price and cost levels that allow the firm to
maximize profit per product
Status quo - CORRECT ANSWER identify price levels similar to competitor average
price
Market share - CORRECT ANSWER adjust price levels so that the firm can maintain
or increase sales relative to competitors' sales
Sources of competitors pricing information - CORRECT ANSWER -comparative
shoppers
Importance of knowing competitors prices - CORRECT ANSWER -Helps determine
how important price will be to customers
-Helps marketers in setting competitive prices for their products
