MKT315 Final Exam Study Guide / Questions And Answers
Average Cost ANS:- The total cost divided by quantity produced.
Bait-and-Switch ANS:- An illegal pricing practice whereby an advertised price is
used as bait to lure consumers with the intention of switching their purchase to a
higher priced item.
Break-Even Analysis ANS:- The point where average revenue is equal to average
total costs.
Corporate Social Responsibility (CSR) ANS:- Proactive and voluntary behavior of
organizations beyond economic, ethical, and legal responsibilities.
Cost-Plus Pricing ANS:- An estimation of costs and expenses associated with the
product while still permitting the owner to earn a reasonable return.
Dynamic Pricing ANS:- A price set on time, availability, and other factors, in
response to an individual consumer's demand.
Every Day Low Price (EDLP) ANS:- A price strategy providing one low price on a
consistent basis, without the need to run sales and promotions.
Fixed Costs ANS:- Costs that are independent of the quantity of goods produced,
such as rent and utilities.
Game Theory ANS:- The study of interaction, conflict, and cooperation among
players in the market and how this interaction ultimately affects each player's
actions.
Loss-Leader Pricing ANS:- An item sold at less-than-market prices, often below
cost, in order to lure consumers into a store to purchase other products.
Marginal Revenue (MR) ANS:- Represents the change in total revenue divided by
change in quantity.
Maslow's Hierarchy of Needs ANS:- Stems from psychology and sociology, it has
applications in the study of human behavior in marketing; marketers sometimes use
emotional appeals to entice consumers to buy a certain product, service, or brand.
Monopoly ANS:- Exists when a business has exclusive control of the market;
courts look at whether or not a business acts in such a manner as to substantially
try to reduce competition.
Odd-Even Pricing ANS:- Price strategy where the price is just below the next
round number.
Oligopoly ANS:- Exists when relatively few firms dominate the market.
,Pay-What-You-Want (PWYW) Price ANS:- Gives consumers the ability to choose
from among many options and features to arrive at their desired price point.
Penetration Pricing ANS:- Strategically setting a lower-than-market price in order
to promote the brand.
Porter's Five Forces ANS:- A theoretical tool for analyzing the competition of an
organization.
Predatory Pricing ANS:- Setting such a low price to undercut the competition in
order to drive them out of the market with the intent to increase prices.
Prestige Pricing ANS:- Employing higher-than-market prices because of some
attribute.
Price Bundling ANS:- Pricing strategy of two or more products sold in a single
package.
Price Discrimination ANS:- Charging different prices to different buyers without a
legitimate basis, such as geographical location or volume.
Price Elasticity of Demand ANS:- A measure of price sensitivity providing a
relationship between adjustments in price and the quantity demanded of a good or
service.
Price Fixing ANS:- Collusion among two or more businesses that conspire to
regulate prices.
Price Skimming ANS:- Strategically set higher-than-market price in order to take
advantage of profits in the beginning of the product life cycle.
Profit ANS:- Net income derived from sales of a product or service.
Quantity Discounts ANS:- Where a manufacturer, wholesaler, or retailer charges
lower prices per unit for higher volumes purchased.
Return on Investment (ROI) ANS:- Measures the profit or loss generated by the
investment relative to the costs associated with that product.
Round Promotions ANS:- Price strategy in which the dollar amount is an exact
round number.
Segment Return on Assets ANS:- An ROI tool that measures the profitability of a
specific segment.
Theory of Substitution ANS:- A theory that the maximum value of an item is
restricted by the cost of equivalent substitutes in the market.
Total Cost (TC) ANS:- The total economic cost of production, computed by adding
variable costs (VC) and fixed costs (FC).
, Total Revenue ANS:- The price of each good or service sold multiplied by the
quantity of the good or service sold.
Trade Allowances ANS:- A percentage discount off list price to members within
the distribution channel in B2B sales.
Variable Costs ANS:- Costs that vary according to the quantity of goods
produced, such as labor and raw materials.
Average Cost ANS:- The total cost divided by quantity produced.
Bait-and-Switch ANS:- An illegal pricing practice whereby an advertised price is
used as bait to lure consumers with the intention of switching their purchase to a
higher priced item.
Break-Even Analysis ANS:- The point where average revenue is equal to average
total costs.
Corporate Social Responsibility (CSR) ANS:- Proactive and voluntary behavior of
organizations beyond economic, ethical, and legal responsibilities.
Cost-Plus Pricing ANS:- An estimation of costs and expenses associated with the
product while still permitting the owner to earn a reasonable return.
Dynamic Pricing ANS:- A price set on time, availability, and other factors, in
response to an individual consumer's demand.
Every Day Low Price (EDLP) ANS:- A price strategy providing one low price on a
consistent basis, without the need to run sales and promotions.
Fixed Costs ANS:- Costs that are independent of the quantity of goods produced,
such as rent and utilities.
Game Theory ANS:- The study of interaction, conflict, and cooperation among
players in the market and how this interaction ultimately affects each player's
actions.
Loss-Leader Pricing ANS:- An item sold at less-than-market prices, often below
cost, in order to lure consumers into a store to purchase other products.
Marginal Revenue (MR) ANS:- Represents the change in total revenue divided by
change in quantity.
Maslow's Hierarchy of Needs ANS:- Stems from psychology and sociology, it has
applications in the study of human behavior in marketing; marketers sometimes use
emotional appeals to entice consumers to buy a certain product, service, or brand.
Average Cost ANS:- The total cost divided by quantity produced.
Bait-and-Switch ANS:- An illegal pricing practice whereby an advertised price is
used as bait to lure consumers with the intention of switching their purchase to a
higher priced item.
Break-Even Analysis ANS:- The point where average revenue is equal to average
total costs.
Corporate Social Responsibility (CSR) ANS:- Proactive and voluntary behavior of
organizations beyond economic, ethical, and legal responsibilities.
Cost-Plus Pricing ANS:- An estimation of costs and expenses associated with the
product while still permitting the owner to earn a reasonable return.
Dynamic Pricing ANS:- A price set on time, availability, and other factors, in
response to an individual consumer's demand.
Every Day Low Price (EDLP) ANS:- A price strategy providing one low price on a
consistent basis, without the need to run sales and promotions.
Fixed Costs ANS:- Costs that are independent of the quantity of goods produced,
such as rent and utilities.
Game Theory ANS:- The study of interaction, conflict, and cooperation among
players in the market and how this interaction ultimately affects each player's
actions.
Loss-Leader Pricing ANS:- An item sold at less-than-market prices, often below
cost, in order to lure consumers into a store to purchase other products.
Marginal Revenue (MR) ANS:- Represents the change in total revenue divided by
change in quantity.
Maslow's Hierarchy of Needs ANS:- Stems from psychology and sociology, it has
applications in the study of human behavior in marketing; marketers sometimes use
emotional appeals to entice consumers to buy a certain product, service, or brand.
Monopoly ANS:- Exists when a business has exclusive control of the market;
courts look at whether or not a business acts in such a manner as to substantially
try to reduce competition.
Odd-Even Pricing ANS:- Price strategy where the price is just below the next
round number.
Oligopoly ANS:- Exists when relatively few firms dominate the market.
,Pay-What-You-Want (PWYW) Price ANS:- Gives consumers the ability to choose
from among many options and features to arrive at their desired price point.
Penetration Pricing ANS:- Strategically setting a lower-than-market price in order
to promote the brand.
Porter's Five Forces ANS:- A theoretical tool for analyzing the competition of an
organization.
Predatory Pricing ANS:- Setting such a low price to undercut the competition in
order to drive them out of the market with the intent to increase prices.
Prestige Pricing ANS:- Employing higher-than-market prices because of some
attribute.
Price Bundling ANS:- Pricing strategy of two or more products sold in a single
package.
Price Discrimination ANS:- Charging different prices to different buyers without a
legitimate basis, such as geographical location or volume.
Price Elasticity of Demand ANS:- A measure of price sensitivity providing a
relationship between adjustments in price and the quantity demanded of a good or
service.
Price Fixing ANS:- Collusion among two or more businesses that conspire to
regulate prices.
Price Skimming ANS:- Strategically set higher-than-market price in order to take
advantage of profits in the beginning of the product life cycle.
Profit ANS:- Net income derived from sales of a product or service.
Quantity Discounts ANS:- Where a manufacturer, wholesaler, or retailer charges
lower prices per unit for higher volumes purchased.
Return on Investment (ROI) ANS:- Measures the profit or loss generated by the
investment relative to the costs associated with that product.
Round Promotions ANS:- Price strategy in which the dollar amount is an exact
round number.
Segment Return on Assets ANS:- An ROI tool that measures the profitability of a
specific segment.
Theory of Substitution ANS:- A theory that the maximum value of an item is
restricted by the cost of equivalent substitutes in the market.
Total Cost (TC) ANS:- The total economic cost of production, computed by adding
variable costs (VC) and fixed costs (FC).
, Total Revenue ANS:- The price of each good or service sold multiplied by the
quantity of the good or service sold.
Trade Allowances ANS:- A percentage discount off list price to members within
the distribution channel in B2B sales.
Variable Costs ANS:- Costs that vary according to the quantity of goods
produced, such as labor and raw materials.
Average Cost ANS:- The total cost divided by quantity produced.
Bait-and-Switch ANS:- An illegal pricing practice whereby an advertised price is
used as bait to lure consumers with the intention of switching their purchase to a
higher priced item.
Break-Even Analysis ANS:- The point where average revenue is equal to average
total costs.
Corporate Social Responsibility (CSR) ANS:- Proactive and voluntary behavior of
organizations beyond economic, ethical, and legal responsibilities.
Cost-Plus Pricing ANS:- An estimation of costs and expenses associated with the
product while still permitting the owner to earn a reasonable return.
Dynamic Pricing ANS:- A price set on time, availability, and other factors, in
response to an individual consumer's demand.
Every Day Low Price (EDLP) ANS:- A price strategy providing one low price on a
consistent basis, without the need to run sales and promotions.
Fixed Costs ANS:- Costs that are independent of the quantity of goods produced,
such as rent and utilities.
Game Theory ANS:- The study of interaction, conflict, and cooperation among
players in the market and how this interaction ultimately affects each player's
actions.
Loss-Leader Pricing ANS:- An item sold at less-than-market prices, often below
cost, in order to lure consumers into a store to purchase other products.
Marginal Revenue (MR) ANS:- Represents the change in total revenue divided by
change in quantity.
Maslow's Hierarchy of Needs ANS:- Stems from psychology and sociology, it has
applications in the study of human behavior in marketing; marketers sometimes use
emotional appeals to entice consumers to buy a certain product, service, or brand.
