【正文】 ust another method to distribute attributable costs across the product line. Answer: False Page: 443 Level of difficulty: Medium80. Total costs consist of the sum of the fixed and variable costs associated with the product. Answer: True Page: 442 Level of difficulty: Easy81. In targetreturn pricing, the firm determines the markup required and adds that amount to the fixed cost of the product. Answer: False Page: 444 Level of difficulty: Hard82. An increasing number of panies are basing their pricing on perceived value, which is the value that the consumer decides the product is worth and is the same across all ines and regions of the pany. Answer: False Page: 445 Level of difficulty: Hard83. The key to effectively using perceivedvalue pricing is to always to deliver the same or equal value as your petitors. Answer: False Page: 446 Level of difficulty: Medium84. Value pricing is a matter of reengineering the pany’s operations to bee a lowcost producer. Answer: True Page: 447 Level of difficulty: Medium 85. EDLP pricing is a type of goingrate pricing in which the retailer sets low prices everyday on selected items. Answer: False Page: 447 Level of difficulty: Medium86. The final price charged by the pany does not necessarily have to take into account the brand’s quality and advertising relative to petition. Answer: False Page: 448 Level of difficulty: Hard87. In some cases, price is not as important as quality and other benefits in the market offering. Answer: True Page: 448 Level of difficulty: Medium88. Management need not consider how the marketing/distribution channels will react to its pricing policies. Answer: False Page: 450 Level of difficulty: Hard89. When the seller receives full payment in cash and agrees to spend a substantial amount of the money in that country within a stated time period this is called offset. Answer: True Page: 451 Level of difficulty: Easy90. Discount pricing, is when panies adjust their list prices, and give discounts and allowance for early payments, volume purchases, and offseason buying. Answer: True Page: 451 Level of difficulty: Medium91. A quantity discount is a price reduction given to those who buy a large volume of the manufacturer’s products. Answer: True Page: 452 Level of difficulty: Medium92. Price discrimination in all forms is illegal in the United States under the RobinsonPatman Act. Answer: False Page: 453 Level of difficulty: Medium93. Predatory pricing—selling below cost with the intention of destroying petition is legal under certain conditions. Answer: False Page: 455 Level of difficulty: Hard94. Companies sometimes initiate price cuts in a drive to dominate the market through lower costs. Answer: True Page: 455 Level of difficulty: Easy95. A major circumstance provoking price increases is cost inflation. Answer: True Page: 455 Level of difficulty: Medium96. A factor leading to price increases is overdemand by the market for the pany’s product. Answer: True Page: 457 Level of difficulty: Easy97. Companies do not need to concern themselves with their petitors when executing a price change. Answer: False Page: 459 Level of difficulty: Easy98. A brand leader can respond to a petitor’s price decline by executing a “poison pill” strategy toward the petitor. Answer: False Page: 460 Level of difficulty: Hard99. Psychological discounting involves setting an artificially high price and then offering the product at substantial savings. Answer: True Page: 453 Level of difficulty: Hard100. When firms charge different prices to different consumer groups (senior citizens for example) this is a form of price discrimination and is illegal. Answer: False Page: 453 Level of difficulty: Easy Essay101. Explain why and how the Internet is partially reversing the fixed price concept of retailing? Suggested Answer: Computer technology is making it easier for sellers to use software that monitors customers’ movements over the Web and allows them to customize offers and prices. New software applications are also allowing buyers too pare prices instantaneously through online robotic shoppers or “shopbots.” Page: 432 Level of difficulty: Easy102. Prior research has shown that although consumers may have fairly good knowledge of the range of prices involved, surprisingly few can recall specific prices of products accurately. When examining products, consumers often employ reference prices. List the possible prices consumers’ use as their “reference.” Suggested Answer: These reference prices include “fair price,” (what the product should cost)。 typical price。 last price paid。 upperbound price (reservation price or what most consumers would pay)。 lowerbound price (lower threshold price or the least consumers would pay)。 petitor price。 expected future price。 and usual discounted price. Page: 435 Level of difficulty: Hard103. In setting the “price” for their products or services, firms must stop and pause to reflect on the many factors affecting its pricing policy. List these six factors and briefly the subsequent ponents of each one of them. Suggested Answer: The sixstep procedure includes: Step 1: selecting the price objective—there are five objectives available here: survival, maximum current profit, maximum market share, maximum market skimming, or productquality leadership. Step 2: determining demand—price sensitivity, estimating demand curves, and price elasticity. Step 3: estimating costs—fixed and variable costs, accumulated production, activitybased cost accounting, and target costing. Step 4: analyzing petitors’ costs, prices, and offers—reviewing the market and noting petition. Step 5: selecting a pricing method—use markup or margin, perceivedvalue pricing, value pricing, EDLP, highlow, goingrate pricing, and auctiontype pricing. Step 6: sele