COMMERCE 1MA3 Final Exam (Latest
2026/2027) Real Questions and 100%
Correct Answers (High Score
Guaranteed)
• The Role of Price in the Marketing Mix -✓✓-Price is usually ranked as one of the most
important factors in purchase decisions
-Price is the only marketing mix element that generates revenue
- can be the most challenging of the 4Ps to manage, partly because it is the least
understood/misunderstood by managers
• 5 C's of Pricing -✓✓competition, costs, company objectives, customers, channel
members
• 5 C's of Pricing: Company objectives (3 types of orientation) -✓✓- profit orientation
- Maximize profits
- target return pricing
- target profit pricing
- Sales orientation
- Competitor orientation
- customer orientation
• 5 C's of Pricing: customers -✓✓- MOST IMPORTANT C!!!!
- its all about understanding consumers reactions to different prices
- consumers want value
- price is half of the value equation
• Psychological pricing: odd vs even pricing -✓✓odd numbers convey a bargain image --
> 9.99$
Even numbers convey quality image --> 100$
• Demand Curve and Pricing -✓✓- demand increases as price decreases
- demand decreases as price decreases
• price elasticity of demand -✓✓- how do consumers respond to price increases and
decreases?
- this is measured by the price elasticity of demand
,• factors influencing price elasticity of demand: income effects -✓✓- generally, as ppl's
income increases, their spending behavior changes
- demand shifts from lower-priced products to higher priced products
• Factors influencing price elasticity of demand: substitution effects -✓✓- the greater the
availability of substitute products, the higher the price elasticity of demand for any given
product
• 5 C's of Pricing: costs (3 types of costs) -✓✓Variable costs
- vary with production volume
ex: gas, houses...
Fixed costs
- unaffected by production volume
ex: shoes
Total costs
- sum of variable and fixed costs
• break-even analysis - definition? -✓✓a method of determining what sales volume must
be reached before total revenue equals total costs
• Break Even Formula -✓✓Fixed costs / contribution per unit
Total variable cost = variable cost per unit x Quantity
Total cost = Fixed cost + total variable cost
Total revenue = price x Quantity
• The ZYX Company makes a product that has a MSRP of $10. Theactual street price,
however, is $9 and gives retailers a $4 profitmargin. The unit variable cost is $3. Fixed
costs include $17,000,000for consumer advertising, $5,000,000 for consumer
promotion,$12,000,000 for trade promotion, a $20,000,000 sales force budget,and
$6,000,000 for general and administrative expenses.
What is break even ? -✓✓idk
• 5 C's of Pricing: Competition (4 types) -✓✓
• 5 C's of Pricing: Channel Members -✓✓- manufacturers, wholesalers and retailers can
have different perspectives on pricing strategies
, - manufacturers must protect against grey market transactions
• Pricing methods & strategies (3 types) -✓✓
• Pricing methods & strategies: cost based methods -✓✓- cost base pricing methods
start with cost
- all costs calculated on a per unit basis
- assumes costs don't vary for different levels of production
• Pricing methods & strategies: competitor based methods -✓✓- set prices to signal
information of how product compares with competitors
- premium pricing
• Pricing methods & strategies: value based methods -✓✓- setting prices that focus on
the overall value of the product
- consumer perceptions
• psychological factors affecting value-based pricing strategies -✓✓- market penetration
pricing
- everyday low pricing (EDLP)
- high/low
- new product pricing
• everyday low pricing (EDLP) -✓✓- value is created in different ways
- EDLP saves search costs of finding lowest overall prices
- High/low provides thrill of the chase for the lowest price
• high/low pricing -✓✓relies on the promotion of sales, during which prices are
temporarily reduced to encourage purchases
• New Product Pricing Strategies (2 types) -✓✓- price skimming
- market penetration
• Consumers' Use of Reference Prices -✓✓the price against which buyers compare the
actual selling price of the product and that facilitates their evaluation process
• pricing tactics - consumers (3 pricing tactics) -✓✓
• consumer price reductions -✓✓markdowns, quantity discounts for consumers,
coupons and rebates
• Markdowns -✓✓-An integral component of high/low pricing strategy
2026/2027) Real Questions and 100%
Correct Answers (High Score
Guaranteed)
• The Role of Price in the Marketing Mix -✓✓-Price is usually ranked as one of the most
important factors in purchase decisions
-Price is the only marketing mix element that generates revenue
- can be the most challenging of the 4Ps to manage, partly because it is the least
understood/misunderstood by managers
• 5 C's of Pricing -✓✓competition, costs, company objectives, customers, channel
members
• 5 C's of Pricing: Company objectives (3 types of orientation) -✓✓- profit orientation
- Maximize profits
- target return pricing
- target profit pricing
- Sales orientation
- Competitor orientation
- customer orientation
• 5 C's of Pricing: customers -✓✓- MOST IMPORTANT C!!!!
- its all about understanding consumers reactions to different prices
- consumers want value
- price is half of the value equation
• Psychological pricing: odd vs even pricing -✓✓odd numbers convey a bargain image --
> 9.99$
Even numbers convey quality image --> 100$
• Demand Curve and Pricing -✓✓- demand increases as price decreases
- demand decreases as price decreases
• price elasticity of demand -✓✓- how do consumers respond to price increases and
decreases?
- this is measured by the price elasticity of demand
,• factors influencing price elasticity of demand: income effects -✓✓- generally, as ppl's
income increases, their spending behavior changes
- demand shifts from lower-priced products to higher priced products
• Factors influencing price elasticity of demand: substitution effects -✓✓- the greater the
availability of substitute products, the higher the price elasticity of demand for any given
product
• 5 C's of Pricing: costs (3 types of costs) -✓✓Variable costs
- vary with production volume
ex: gas, houses...
Fixed costs
- unaffected by production volume
ex: shoes
Total costs
- sum of variable and fixed costs
• break-even analysis - definition? -✓✓a method of determining what sales volume must
be reached before total revenue equals total costs
• Break Even Formula -✓✓Fixed costs / contribution per unit
Total variable cost = variable cost per unit x Quantity
Total cost = Fixed cost + total variable cost
Total revenue = price x Quantity
• The ZYX Company makes a product that has a MSRP of $10. Theactual street price,
however, is $9 and gives retailers a $4 profitmargin. The unit variable cost is $3. Fixed
costs include $17,000,000for consumer advertising, $5,000,000 for consumer
promotion,$12,000,000 for trade promotion, a $20,000,000 sales force budget,and
$6,000,000 for general and administrative expenses.
What is break even ? -✓✓idk
• 5 C's of Pricing: Competition (4 types) -✓✓
• 5 C's of Pricing: Channel Members -✓✓- manufacturers, wholesalers and retailers can
have different perspectives on pricing strategies
, - manufacturers must protect against grey market transactions
• Pricing methods & strategies (3 types) -✓✓
• Pricing methods & strategies: cost based methods -✓✓- cost base pricing methods
start with cost
- all costs calculated on a per unit basis
- assumes costs don't vary for different levels of production
• Pricing methods & strategies: competitor based methods -✓✓- set prices to signal
information of how product compares with competitors
- premium pricing
• Pricing methods & strategies: value based methods -✓✓- setting prices that focus on
the overall value of the product
- consumer perceptions
• psychological factors affecting value-based pricing strategies -✓✓- market penetration
pricing
- everyday low pricing (EDLP)
- high/low
- new product pricing
• everyday low pricing (EDLP) -✓✓- value is created in different ways
- EDLP saves search costs of finding lowest overall prices
- High/low provides thrill of the chase for the lowest price
• high/low pricing -✓✓relies on the promotion of sales, during which prices are
temporarily reduced to encourage purchases
• New Product Pricing Strategies (2 types) -✓✓- price skimming
- market penetration
• Consumers' Use of Reference Prices -✓✓the price against which buyers compare the
actual selling price of the product and that facilitates their evaluation process
• pricing tactics - consumers (3 pricing tactics) -✓✓
• consumer price reductions -✓✓markdowns, quantity discounts for consumers,
coupons and rebates
• Markdowns -✓✓-An integral component of high/low pricing strategy
