MKT301 Kerin book – Testbank – Pricing, Channels, SCM, Marcom
CHAPTER 13
BUILDING THE PRICE FOUNDATION
MULTIPLE CHOICE QUESTIONS
13-1 CHAPTER OPENING EXAMPLE CONCEPTUAL
What do Expedia, Travelocity, and Priceline have in common?
a. They are three websites that use the same Internet service provider (ISP).
b. They are companies that use reverse auctions to sell their merchandise.
c. They are three online websites that only sell to businesses.
d. They are all franchise operations that operate in the business-to-business market
only.
e. They are the three leading online travel websites.
Answer: e Page: 335
Rationale: These three websites book airline tickets, hotel rooms, and special travel
packages for travelers.
13-2 CHAPTER OPENING EXAMPLE CONCEPTUAL
Online travel websites have not experienced the same problems as other dot-com
companies because these websites:
a. rarely attempt to establish any type of long-term relationships with customers.
b. focus on market share.
c. use tactical objectives instead of strategic objectives.
d. allow customers to save money and time.
e. create form utility for customers.
Answer: d Page: 335
Rationale: Like any company, online travel sites must establish marketing relationships
with customers. The online sites can create time and place utility, but not form.
,13-3 CHAPTER OPENING EXAMPLE CONCEPTUAL
Which of the following is true about price?
a. Customers don’t have to pay the price because there are always people who will but
the item.
b. Small changes in price can have big effects on the number of units sold but not
company profit.
c. Small changes in price can have big effects on company profit but not on the number
of units sold.
d. Small changes in price can have big effects on the number of units sold and also on
company profit.
e. All of the above are true.
Answer: d Page: 335
Rationale: Price is the place where all other business decisions come together. The price
must be right in the sense that customers must be willing to pay it and it must generate
enough sales dollars to pay for the cost of developing, producing, and marketing the
product and earn a profit for the company. Small changes in price can have big effects on
both the number of units sold and company profit.
13-4 PRICE CONCEPTUAL
Attorneys fees, entrance fees, train fares, and organization dues are all:
a. premiums.
b. bartering tools.
c. mediums of exchange.
d. synonyms for price.
e. examples of liquidity.
Answer: d Page: 336 Other Locations: web Learning
Objective: 1
Rationale: Tuition, rent, interest, premium, fee, dues, fares, salary, commission and
wage are all synonyms for price.
13-5 PRICE CONCEPTUAL
Which of the following is a particular type of price?
a. operating costs
b. liquidity
c. equitable medium
d. college tuition
e. stockholders' equity
Answer: d Page: 336 Other Locations: SG Learning
Objective: 1
Rationale: College tuition is a special kind of price, the money paid by a college student
for a term of classes.
,13-6 PRICE DEFINITION
From a marketing viewpoint, price is __________ exchanged for the ownership or use of
a good or service.
a. money or other considerations (including goods but not intangibles and services)
b. money or other considerations (including other goods and services)
c. money exclusively earmarked for the transaction
d. what is recognized as barter within a particular culture
e. anything of value to the buyer but not necessarily of value to the seller
Answer: b Page: 336-337 Learning
Objective: 1
Rationale: Key term definition—price
13-7 PRICE DEFINITION
From a marketing viewpoint, __________ is money or other considerations (including
goods and services) exchanged for the ownership or use of a good or service.
a. value
b. price
c. barter
d. a contract
e. a tariff
Answer: b Page: 336-337 Learning
Objective: 1
Rationale: Key term definition—price
13-8 BARTER DEFINITION
Barter is the practice of exchanging goods and services for other goods and services
rather than for:
a. value.
b. perceptions.
c. money.
d. promises.
e. tariffs.
Answer: c Page: 337 Learning Objective: 1
Rationale: Key term definition—barter
, 13-9 BARTER DEFINITION
The practice of exchanging goods and services for other goods and services rather than
for money is called:
a. pricing.
b. pricing substitution.
c. debt restructuring.
d. value-pricing.
e. barter.
Answer: e Page: 337 Other Locations: web Learning
Objective: 1
Rationale: Key term definition—barter
13-10 PRICE APPLICATION
Patty O'Rourke hired an attorney to represent her in a court case involving an auto
accident. The attorney charged O'Rourke a fee for his services. Terry Thomas needed a
haircut--the local stylist charged him $12 for her services. Aaron Mathison mowed his
neighbor's lawn; in exchange, the neighbor roto-tilled Mathison's garden. The attorney
fees paid by O'Rourke, the $12 charged by the hair stylist, and exchange of lawn mowing
for garden tilling are examples of:
a. price.
b. barter.
c. fee setting.
d. unfair market exchanges.
e. product fares.
Answer: a Page: 336 Learning
Objective: 1
Rationale: In the marketing realm, price is the money, goods, or services exchanged
between two or more parties for the ownership or use of a good or service. Just as a
customer pays a specific monetary price for physical product like a loaf of bread or a box
of cereal, the price of a haircut service might be $12. The price of getting one's garden
roto-tilled might take the form of barter--where in exchange for one service or product no
money changes hands, but the parties exchange services or goods.
13-11 PRICE EQUATION DEFINITION
The price equation formula is price equals list price minus discounts and allowances plus:
a. salaries.
b. commissions.
c. trade-ins.
d. extra fees.
e. taxes.
Answer: d Page: 337 Learning Objective: 1
Rationale: The price equation is: price=list price – incentives and allowances+extra
fees.
CHAPTER 13
BUILDING THE PRICE FOUNDATION
MULTIPLE CHOICE QUESTIONS
13-1 CHAPTER OPENING EXAMPLE CONCEPTUAL
What do Expedia, Travelocity, and Priceline have in common?
a. They are three websites that use the same Internet service provider (ISP).
b. They are companies that use reverse auctions to sell their merchandise.
c. They are three online websites that only sell to businesses.
d. They are all franchise operations that operate in the business-to-business market
only.
e. They are the three leading online travel websites.
Answer: e Page: 335
Rationale: These three websites book airline tickets, hotel rooms, and special travel
packages for travelers.
13-2 CHAPTER OPENING EXAMPLE CONCEPTUAL
Online travel websites have not experienced the same problems as other dot-com
companies because these websites:
a. rarely attempt to establish any type of long-term relationships with customers.
b. focus on market share.
c. use tactical objectives instead of strategic objectives.
d. allow customers to save money and time.
e. create form utility for customers.
Answer: d Page: 335
Rationale: Like any company, online travel sites must establish marketing relationships
with customers. The online sites can create time and place utility, but not form.
,13-3 CHAPTER OPENING EXAMPLE CONCEPTUAL
Which of the following is true about price?
a. Customers don’t have to pay the price because there are always people who will but
the item.
b. Small changes in price can have big effects on the number of units sold but not
company profit.
c. Small changes in price can have big effects on company profit but not on the number
of units sold.
d. Small changes in price can have big effects on the number of units sold and also on
company profit.
e. All of the above are true.
Answer: d Page: 335
Rationale: Price is the place where all other business decisions come together. The price
must be right in the sense that customers must be willing to pay it and it must generate
enough sales dollars to pay for the cost of developing, producing, and marketing the
product and earn a profit for the company. Small changes in price can have big effects on
both the number of units sold and company profit.
13-4 PRICE CONCEPTUAL
Attorneys fees, entrance fees, train fares, and organization dues are all:
a. premiums.
b. bartering tools.
c. mediums of exchange.
d. synonyms for price.
e. examples of liquidity.
Answer: d Page: 336 Other Locations: web Learning
Objective: 1
Rationale: Tuition, rent, interest, premium, fee, dues, fares, salary, commission and
wage are all synonyms for price.
13-5 PRICE CONCEPTUAL
Which of the following is a particular type of price?
a. operating costs
b. liquidity
c. equitable medium
d. college tuition
e. stockholders' equity
Answer: d Page: 336 Other Locations: SG Learning
Objective: 1
Rationale: College tuition is a special kind of price, the money paid by a college student
for a term of classes.
,13-6 PRICE DEFINITION
From a marketing viewpoint, price is __________ exchanged for the ownership or use of
a good or service.
a. money or other considerations (including goods but not intangibles and services)
b. money or other considerations (including other goods and services)
c. money exclusively earmarked for the transaction
d. what is recognized as barter within a particular culture
e. anything of value to the buyer but not necessarily of value to the seller
Answer: b Page: 336-337 Learning
Objective: 1
Rationale: Key term definition—price
13-7 PRICE DEFINITION
From a marketing viewpoint, __________ is money or other considerations (including
goods and services) exchanged for the ownership or use of a good or service.
a. value
b. price
c. barter
d. a contract
e. a tariff
Answer: b Page: 336-337 Learning
Objective: 1
Rationale: Key term definition—price
13-8 BARTER DEFINITION
Barter is the practice of exchanging goods and services for other goods and services
rather than for:
a. value.
b. perceptions.
c. money.
d. promises.
e. tariffs.
Answer: c Page: 337 Learning Objective: 1
Rationale: Key term definition—barter
, 13-9 BARTER DEFINITION
The practice of exchanging goods and services for other goods and services rather than
for money is called:
a. pricing.
b. pricing substitution.
c. debt restructuring.
d. value-pricing.
e. barter.
Answer: e Page: 337 Other Locations: web Learning
Objective: 1
Rationale: Key term definition—barter
13-10 PRICE APPLICATION
Patty O'Rourke hired an attorney to represent her in a court case involving an auto
accident. The attorney charged O'Rourke a fee for his services. Terry Thomas needed a
haircut--the local stylist charged him $12 for her services. Aaron Mathison mowed his
neighbor's lawn; in exchange, the neighbor roto-tilled Mathison's garden. The attorney
fees paid by O'Rourke, the $12 charged by the hair stylist, and exchange of lawn mowing
for garden tilling are examples of:
a. price.
b. barter.
c. fee setting.
d. unfair market exchanges.
e. product fares.
Answer: a Page: 336 Learning
Objective: 1
Rationale: In the marketing realm, price is the money, goods, or services exchanged
between two or more parties for the ownership or use of a good or service. Just as a
customer pays a specific monetary price for physical product like a loaf of bread or a box
of cereal, the price of a haircut service might be $12. The price of getting one's garden
roto-tilled might take the form of barter--where in exchange for one service or product no
money changes hands, but the parties exchange services or goods.
13-11 PRICE EQUATION DEFINITION
The price equation formula is price equals list price minus discounts and allowances plus:
a. salaries.
b. commissions.
c. trade-ins.
d. extra fees.
e. taxes.
Answer: d Page: 337 Learning Objective: 1
Rationale: The price equation is: price=list price – incentives and allowances+extra
fees.
