BUAD 307 Final Verified Multiple Choice and Conceptual
Actual Frequently Tested Exam Questions With Reviewed
100% Correct Detailed Answers
Guaranteed Pass!!Current Update!!
1. In class, we discussed the practice of airlines in the U.S. of communicating
through airline reservation systems. If an airline wanted to see if a competitor
would go along with a price increase on a particular route, the airline would post a
higher price on that route valid for only one day. If the other airline agreed to go
along with that, it would raise its price permanently to the higher price. The first
airline would then make that higher price permanent, too. This practice is an
example of:
a. Implicit price discrimination.
b. Explicit price discrimination.
c. Predation.
d. Collusion.
e. Skimming - ANSWER Collusion.
2. An internal reference price:
a. Is more likely to exist for frequently purchased items.
b. Results from the promotion signal.
c. Is usually stored in an electronic device.
d. Will usually decrease price sensitivity (i.e., make consumers willing to pay
higher prices).
,e. None of the above. - ANSWER Is more likely to exist for frequently
purchased items.
3. A discontinuous innovation:
a. Only occurs during the growth phase of the Product Life Cycle.
b. Generally requires less marketing efforts than a dynamically continuous
innovation.
c. Involves an entirely new way of doing something.
d. Both (a) and (c).
e. Both (b) and (c). - ANSWER Involves an entirely new way of doing
something.
4. In the diffusion of ATM cards, ______ was/were especially significant:
A. Trialability.
B. Observability.
C. Network economies.
D. Chicken-and-egg problems.
E. Diminishing sensitivity - ANSWER Observability.
5. Customer value involves:
a. Getting the lowest price possible on a product in a given category.
b. Eliminating intermediaries in distribution.
c. The ratio of benefits received to sacrifices made.
d. All of the above.
,e. None of the above. - ANSWER The ratio of benefits received to sacrifices
made.
6. If it is correct that the costs of selling auto insurance online are much lower
than the selling of auto insurance through traditional agents and/or company
offices:
a. In the long run, firms that sell auto insurance online are likely to be very
profitable.
b. Sellers of online insurance would probably be in violation of laws against price
discrimination.
c. In the long run, online sellers of auto insurance may be able to make a normal
market profit, but it is unlikely that they would make large profits.
d. Existing online sellers of auto insurance are likely to face a "chicken-and-egg"
problem.
e. None of the above. - ANSWER In the long run, online sellers of auto
insurance may be able to make a normal market profit, but it is unlikely that they
would make large profits.
Reason: Since they will be competing with others who have the same cost
advantage, competition will drive down prices to "normal" levels and all the
savings go to customers.
7. Selling products on the Internet:
a. Will usually save the seller a great deal of money compared to traditional
distribution methods, thus raising profitability dramatically.
b. Is more likely to be appropriate for a niche product as opposed to one
demanded by a large percentage of consumers.
, c. Tends to be highly cost effective in the U.S., but is usually considerably more
expensive than traditional distribution methods in most other countries.
d. Both (b) and (c).
e. None of the above. - ANSWER Is more likely to be appropriate for a niche
product as opposed to one demanded by a large percentage of consumers.
8. In order to cost effectively sell products online as opposed to going through
traditional retailers and wholesalers:
a. The value-to-bulk ratio should be low.
b. Absolute margins are usually more critical than percentage margins.
c. The seller should receive the majority of its revenue from micro-payments.
d. All of the above.
e. None of the above. - ANSWER Absolute margins are usually more critical
than percentage margins
9. Relative to selling through brick-and-mortar retail stores, selling online:
a. Is likely to be more suitable for specialty products.
b. Tends to be especially cost effective for low priced items.
c. Tends to significantly reduce costs unless unusually high absolute margins are
involved.
d. Is more likely to be cost effective for products that have a very large market.
e. Tends to greatly reduce labor costs. - ANSWER Is likely to be more suitable
for specialty products.
Actual Frequently Tested Exam Questions With Reviewed
100% Correct Detailed Answers
Guaranteed Pass!!Current Update!!
1. In class, we discussed the practice of airlines in the U.S. of communicating
through airline reservation systems. If an airline wanted to see if a competitor
would go along with a price increase on a particular route, the airline would post a
higher price on that route valid for only one day. If the other airline agreed to go
along with that, it would raise its price permanently to the higher price. The first
airline would then make that higher price permanent, too. This practice is an
example of:
a. Implicit price discrimination.
b. Explicit price discrimination.
c. Predation.
d. Collusion.
e. Skimming - ANSWER Collusion.
2. An internal reference price:
a. Is more likely to exist for frequently purchased items.
b. Results from the promotion signal.
c. Is usually stored in an electronic device.
d. Will usually decrease price sensitivity (i.e., make consumers willing to pay
higher prices).
,e. None of the above. - ANSWER Is more likely to exist for frequently
purchased items.
3. A discontinuous innovation:
a. Only occurs during the growth phase of the Product Life Cycle.
b. Generally requires less marketing efforts than a dynamically continuous
innovation.
c. Involves an entirely new way of doing something.
d. Both (a) and (c).
e. Both (b) and (c). - ANSWER Involves an entirely new way of doing
something.
4. In the diffusion of ATM cards, ______ was/were especially significant:
A. Trialability.
B. Observability.
C. Network economies.
D. Chicken-and-egg problems.
E. Diminishing sensitivity - ANSWER Observability.
5. Customer value involves:
a. Getting the lowest price possible on a product in a given category.
b. Eliminating intermediaries in distribution.
c. The ratio of benefits received to sacrifices made.
d. All of the above.
,e. None of the above. - ANSWER The ratio of benefits received to sacrifices
made.
6. If it is correct that the costs of selling auto insurance online are much lower
than the selling of auto insurance through traditional agents and/or company
offices:
a. In the long run, firms that sell auto insurance online are likely to be very
profitable.
b. Sellers of online insurance would probably be in violation of laws against price
discrimination.
c. In the long run, online sellers of auto insurance may be able to make a normal
market profit, but it is unlikely that they would make large profits.
d. Existing online sellers of auto insurance are likely to face a "chicken-and-egg"
problem.
e. None of the above. - ANSWER In the long run, online sellers of auto
insurance may be able to make a normal market profit, but it is unlikely that they
would make large profits.
Reason: Since they will be competing with others who have the same cost
advantage, competition will drive down prices to "normal" levels and all the
savings go to customers.
7. Selling products on the Internet:
a. Will usually save the seller a great deal of money compared to traditional
distribution methods, thus raising profitability dramatically.
b. Is more likely to be appropriate for a niche product as opposed to one
demanded by a large percentage of consumers.
, c. Tends to be highly cost effective in the U.S., but is usually considerably more
expensive than traditional distribution methods in most other countries.
d. Both (b) and (c).
e. None of the above. - ANSWER Is more likely to be appropriate for a niche
product as opposed to one demanded by a large percentage of consumers.
8. In order to cost effectively sell products online as opposed to going through
traditional retailers and wholesalers:
a. The value-to-bulk ratio should be low.
b. Absolute margins are usually more critical than percentage margins.
c. The seller should receive the majority of its revenue from micro-payments.
d. All of the above.
e. None of the above. - ANSWER Absolute margins are usually more critical
than percentage margins
9. Relative to selling through brick-and-mortar retail stores, selling online:
a. Is likely to be more suitable for specialty products.
b. Tends to be especially cost effective for low priced items.
c. Tends to significantly reduce costs unless unusually high absolute margins are
involved.
d. Is more likely to be cost effective for products that have a very large market.
e. Tends to greatly reduce labor costs. - ANSWER Is likely to be more suitable
for specialty products.
