Price. a standardized product being produced by many firms. Pricing is the only revenue-generating element in the marketing mix (the other three elements are cost centres—that is, they add to a company's cost). The percentage markup on retail is determined by dividing the dollar markup by the retail price. Pricing designed to have a positive psychological impact. Considerations Involved in Formulating the Pricing Policy 3. A group of related items or brands sold by the same company . Product development Maturity Growth Introduction 20. When a company has many product lines and groups them together, it creates a product mix.. Collins Dictionary has the following definition of the term: "A product line is a group of related products produced . Price may take the following forms. Each product within the structure forms a part of the product mix. In most consumers' minds, $99 gives the impression of . Products all function in a similar manner and provide similar benefits. 11) 2 Upload your study docs or become a Course Hero member to access this document Continue to access product bundle pricing In __________pricing, the company sells a product or service at two or more prices, even though the difference in prices is not based on differences in costs. The process of setting a high price for a new product to gain maximum revenues layer by layer form the segments willing to pay the high price is called: a. Answer: pricing to value 11) In this situation, the manager has set a price that is higher than the target market is willing to pay. 2. Describe at least one strategy that would work well for this product, and explain why you believe it would work. a. emphasis of a product line b. product price c. product constraints Od. It is the result of the fact that producing products and services often generates by-products. For . Which of the following is the best description of the 'marketing mix'? The number of all product of similar nature or kind offered by a particular seller for sale. Product. A special sales order is received for 200 units of the product at a price of $20 per unit. Which of the following does not rely on managerial decisions involving accurate product costing? b. A pricing strategy is a method of attaining a competitive price for a product or service. Marketing Management MCQs - 101+ Multiple Choice Question and Answers. An INVOICE can include many detail lines (LINE), each of which describes one product bought by the customer. There are numerous pricing strategies: A. Product Line Pricing is generally used by companies and retailers in order to separate goods and services into cost categories in order to create various perceived quality levels in the minds of consumers. A)product price decreases as output increases. b. d. Products are all sold under the same brand name. Penetration Pricing - Initially setting a low price for a . Business. Price skimming is setting a product's price at the maximum value a customer would be willing to pay. The World Times, a publisher, has set their inventory's price floor to $1.00. A) They tend to be unique. This pricing strategy is combined with the other marketing pricing strategies that are the 4P strategy (products, price, place, and promotion) economic patterns, competition, market demand, and product attributes. segmented Some sellers use 00-cent endings on regularly priced items and 99-cent endings on discount merchandise. lost sales related to deferring investments. A) A strategy for determining the firm's overall attitude toward growth and the way it will manage its businesses or product lines. Product Line Pricing. The money claimed against the offered product or service in the market is called price. Through pricing, the organization manages to support the cost of production, the cost of distribution, and the cost of promotion. Focuses more on promotion strategies than pricing strategies Describes the phases a product goes through during its lifecycle CONCEPT Marketing Strategy 6 A garden supply company advertised that a specific brand of fertilizer was on sale for a limited time. There may be a range of normal price points in a market. A. lost sales related to making unprofitable investments. Some stores have a quality image, and people perceive that perhaps the products from those stores are of higher quality. Pricing is strongly linked to the business model. B)product price increases as output increases. A. When screening product ideas, companies should NOT evaluate their ideas based on which of the following critera. The public has responded favorably and competitors have definitely taken notice. In comparison, most full- line grocers offer more than 25,000 items. A systematic approach to pricing requires the decision that an individual pricing situation be generalised […] What is the price elasticity of demand for the product? A company like HUL or P&G or even top automobile companies like Volkswagen or General motors have multiple product lines and many strategic business units in their organization structure. 2) Cosmetics firm SatinSilk is revamping its mission statement and advertising strategy. Q. Markup Pricing. A major factor in price increases is _____. All the best and keep revising! Which of the following describes product width. The three basic pricing strategies are price skimming, neutral pricing, and penetration pricing. Once competing products start appearing on the market, the manufacturer may have to: Lower pricing due to increased competition a. Each month, Burrel Incorporated produces 500 units of a product that has unit variable costs of $17.00. The entry model obviously costs you less than the top-range car. Which of the following describe product line pricing? This is when demand is at its strongest. Play this game to review Other. Prices ending with a "9" sell better. A) Depreciation is deducted from the annual cash inflows. A ) a failure to ask enough probing questions to identify a problem. Usually, the price point category refers to where the product lies in the pricing spectrum ranging from discount to designer. Products line pricing is defined as pricing a single product or service and pricing a range of products. Marketing functions are those mechanisms or . This marketing tactic is known as . What is a protype. a. Often, these by-products (as singly sold products) would not have any value and get rid of them is costly. Used by manufacturers, wholesalers, and retailers, a markup is calculated by adding a set amount to the cost of a product, which results in the price charged to the customer. A test described in the pricing strategy book Priceless said that a product was sold for three different prices: $34, $39, and $44 dollars. For example, when you look at a car brand such as Audi, you will see a relation between the different series and their prices. Factors Involved. price is greater than seller's marginal revenue Product Line 1 consists of products that are fruit-based; and Product Line 2 consists of products for sports activities. Product sales peak during the maturity phase, which should be the longest part of its life cycle. True. Setting a low price for a new product in order to attract a large number of buyers and large market share During product development, sales are zero and the company's investment costs mount. E ) an inability to negotiate across cultures. price equals seller's marginal revenue Monopoly 1.) The line item is not achieving its desired KPI or goal. A pricing strategy is a method for determining the optimum price of a product or service. Market-penetration pricing New-product pricing Discount pricing 19. This preview shows page 9 - 13 out of 64 pages. The basic methods of transporting forest products. B) They are priced by managers using a target-costing emphasis. However, some definitions aren't so neat and tidy. Selected Answer: Incorrect [None Given] Correct Answer: Correcta. What is a product line. losses related to declining market share for companies that are not technological leaders. Product-line pricing involves offering both a high-priced and a low-priced brand. For example, some product classes -like sportswear or sleepwear- can limit your price point category. The matrix quadrants show: Economy Pricing - Setting a low price for low-quality goods. An effective product line pricing involves having adequate price gaps between categories and items to inform possible buyers of difference in quality that exists. 10) Which of the following best describes setting a price at the level determined to represent the customer's perceived value for your product? Answer:C. 54)When a firm is maximizing profit it will necessarily be: A)maximizing the difference between total revenue and total cost. The set of all product line or item which a particular seller offers to sale. When you go for a car wash you have an option of choosing a car wash for Rs 200 or a car wash and a car wax for Rs 400 or the entire package including a service at Rs 600. Premium pricing (Charging a high price, with good quality product/service - like Mark & Spencer products) 2. A supplier might decide to a product suitable for all price levels, offering opportunities for a range of purchases. The business model is a conceptual representation of the company's revenue . The line item is spending its budget at an optimal pace. a large number of firms producing a differentiated product. Setting the price steps between various products in a product line based on cost differences between the products, customer evaluations of different features, and competitors' prices B. Products share the same product managers. . Suppose the government imposes an excise tax on a product with a demand curve of constant slope of -3. Introduction The role of marketing in product development. Question: Which of the following does not rely on managerial decisions involving accurate product costing? In essence, multiple product lines . d. Products are all sold under the same brand name. Which of the following is This problem has been solved! Many times, two different stores carry the same product, but one store prices it higher because of the store's perceived higher image. Marketing executives believe that product lines give companies a competitive advantage.When a business has a competitive advantage, it has an edge over its rivals. Average cost and marginal cost are two types of costs that we have covered in economics class. Section 1: In the introduction of the IMC plan you will describe what the product or service is that you will be advertising. Pricing is the process whereby a business sets the price at which it will sell its products and services, and may be part of the business's marketing plan.In setting prices, the business will take into account the price at which it could acquire the goods, the manufacturing cost, the marketplace, competition, market condition, brand, and quality of product. 2012 12,000 $5.00 . For example, when you look at a car brand, you will see a relation between the different series and their prices. Which of the following describe product line pricing? 6. Make product, price, and promotion. The line item is not spending enough of the allocated budget. As the product moves through the stages of the life cycle, the firm must keep revising the marketing mix to stay competitive and meet the needs of target customers. A. D)marginal revenue declines as more output is produced. (c) 81. Products all function in a similar manner and provide similar benefits. a. 5 Types of Product Mix Pricing Strategies The public has responded favorably and competitors have definitely taken notice. Demand-based pricing refers to a pricing method in which the price of a product is finalized according to its demand. answer choices . This is an example of which marketing mix element? c. Which of the following will happen? Since firms usually develop product lines rather than single products, product line pricing plays a decisive role in product mix pricing strategies. Setting the price steps between various products in a product line based on cost differences between the products, customer evaluations of different features, and competitors' prices. The product, price, communications, distribution, and services provided to the target market is referred to as the _____. Select one: a. may earn long-run economic profits 4.) (1-6 sentences. (a) dimensions in the product line. B) A strategy at the business unit or product line level that focuses on improving a firm's competitive position. Simplistically, price is the value measured in . (e) specialties a company offers. Total fixed costs for the month are $4,375. The product information is stored in a PRODUCT entity. The magic number nine. After product, pricing plays a key role in the marketing mix. Objectives 4. 11 different types of pricing 1) Premium pricing . many firms 3.) If the price of a product is $100 and the company prices it at $99, then it is using the psychological technique of just-below pricing. A product line is a group of products that are closely related for which of the following reasons? Meaning of Pricing Policy: A pricing policy is a standing answer to recurring question. c. The same company developed the idea for each product. Question 1 0 out of 1 points product line pricing. A) the product mix B) product line filling C) the promotion mix D) the price mix E) horizontal diversification Answer: C) the promotion mix. A product line with low-end, mid-range, and high-end pricing means you're likely to pull in an array of customers with various needs who'll be catered to by different cost categories. SURVEY . Economics. Markup Pricing. Product Line Pricing. There are five common product line pricing strategies - captive pricing, leader pricing, bait pricing, price lining, and price bundling. Its purpose is to give the background of the product/service and a description to the reader so that they understand what your proposal is about. Markup Pricing: The markup on cost can be calculated by adding a preset, often industry standard, profit margin percentage to the cost of the merchandise. Learn More : Share this It is a distinct unit within the product line that is distinguishable by size, price, appearance, or some other attribute. Product line pricing and captive-product pricing c. Market-skimming pricing and market-penetration pricing d. Market- expansion pricing and market harvesting pricing Ans. The quantity supplied will fall, and the price will fall, creating a deadweight loss. ANSWER: b Take up the quiz below and see how much you understand these costs as taught in class. Product sales peak during the maturity phase, which should be the longest part of its life cycle. Its product line includes a little more than 700 most-often-used products for the average home. Competitive advantage. The number of product lines a company offers to its customers. Meaning of Pricing Policy 2. 10) Which of the following best describes setting a price at the level determined to represent the customer's perceived value for your product? asked Jun 15, 2016 in Business by zetapeeps. In many lines of trade, sellers use well-established price points for the products in their line. A manufacturer progressively reduces the price of his product in an attempt to increase total revenue. 18. D C The background part briefly describes your company's history and gives a . Captive product pricing (Products that complement others, like cheaper tooth paste and costly tooth brush, cheaper printer costly cartridge) 3. The CEO stresses that the new mission statement should be market-oriented rather than product-oriented. Product Line Depth When discussing product lines, it is important to understand the idea of "product line depth." It refers to the number of products offered under a product line. a single firm producing a product for which there are no close substitutes. This is when demand is at its strongest. A. . its price relative to other products in the firm's product line D) its price relative to competitors' products . There will be examples with each type of strategy. Which of the following BEST describes a business strategy? Let us take and understand this with the help of an example. The product mix is the collection of all those products and services that a particular company offers in the market. A group of goods that are closely related and function in a similar manner Some products are promoted by placing them in television shows or in movies in order to increase brand awareness. Group of answer choices any market in which the demand curve to the firm is downsloping. It is a type of pricing which involves establishing a price higher than your competitors to achieve a premium positioning.You can use this kind of pricing when your product or service presents some unique features or core advantages, or when the company has a unique competitive advantage compared to its rivals. The entry model, the Audi Al, does cost you less . Product Line Pricing: Product- line pricing is a strategy which involves all product offered. The product's vendor information is found in a VENDOR entity The ERD must reflect business rules that you are free to define (within reason). The product life cycle is a pattern of sales and profits over time for a product (Ivory dishwashing liquid) or a product category (liquid detergents). . Relative to 2011, the price of corn for 2012 was: (a) Higher by 20% (b) Lower by 25% (c) Lower by 20% (d) Higher by 25% . 4.0 points) Product, profile, price, and promotion. If the demand of a product is more, an organization prefers to set high prices for products to gain profit; whereas, if the demand of a product is less, the low prices are charged to attract the customers. For example, there are often benefits to selling a product at $3.95 or $3.99, rather than $4.00. ADVERTISEMENTS: In this article we will discuss about:- 1. The highest volume of sales took place when the price was $39. seller has no market power 4.) . The line item is achieving its performance goal but has potential to perform better. ANSWER: b Competitive market 1.) product placement By-product pricing refers to setting a price for by-products to make the main product's price more competitive. Which of the following BEST defines a product line? _____ is a period of market acceptance and increasing profits. The table shows the outcome of this policy. b. Since firms usually develop product lines rather than single products, product line pricing plays a decisive role in product mix pricing strategies. Which of the following terms best describes this set of communications tools? 1. Price. TIP: Pricing strategies include psychological pricing, unit pricing, product line pricing, promotional pricing, penetration pricing, and price skimming. Used by manufacturers, wholesalers, and retailers, a markup is calculated by adding a set amount to the cost of a product, which results in the price charged to the customer. Product Line Pricing: 1. c. The same company developed the idea for each product. In other words the value exchanged for use of the benefits of a certain product or service. 45 seconds . D) Depreciation is added to the annual cash inflows. Answer: pricing to value 11) In this situation, the manager has set a price that is higher than the target market is willing to pay. The reason for this importance is that where the rest of the elements of the marketing mix are cost generators, price is a source of income and profits. Product line pricing is more effective when there are ample price gaps between each category so that the consumer is well informed of the quality differentials. Products share the same product managers. Which of the following describe a population in terms of its size, distribution, and structure? Year Output (in bushels) Price/Bushel 2011 10,000 $4.00 . (c) items in the product line. The challenges of pricing forest industry products and the potential impacts of moving toward special and custom-made products. Q.1 In the literature of product life cycle management, the term technological risk refers to. 35. The Pricing Strategy Matrix describes four of the most common strategies by mapping price against quality. The quantity supplied will fall, and the price will rise, creating a deadweight loss. For . Product Line Pricing: Normally product lines are developed by the companies rather than single products and introduce price steps. _____ begins when the company finds and develops a new-product idea. Management is deciding whether or not to offer the entire new line of athletic equipment. In essence, multiple product lines . C ) a failure to accurately understand the other person 's point. (d) lines a company offers. Prestige pricing occurs when a higher price is utilized to give an offering a high-quality image. A) a sales price, cost, or quantity that is expected under normal conditions B) costs incurred to produce a product C) budgeted amount for total product cost D) actual sales price, cost, or quantity Answer: A A ) a sales price , cost , or quantity that is expected under normal conditions C) Depreciation does not affect the payback calculation. C)product price is constant at all levels of output. It is important for a manufacturer to know how to use these two costs to ensure maximization of profit with ultimate supply. MCQ on Product Lifecycle Management. The product mix constitutes not only a single product line but all the products within an organization. 7. seller has significant market power 2.) The product mix constitutes not only a single product line but all the products within an organization. The planning team comes up with a list of options for the new mission statement. (b) features in each brand. Which of the following describes the products and services of companies that are price-setters? For example, all the courses a university offers constitute its product mix, courses in the marketing department constitute a product line, and the principles of marketing course is a product item. The width of a product mix is measured by the number of product. product mix. Pricing is one of the four main elements of the marketing mix. B ) a failure to agree even when both sides understand each other. B) Depreciation is only deducted if the payback period exceeds five years. Types of Retailers - Classified on the Basis of Size, Geographic Location, Product-Line Method and Form of Ownership Once competing products start appearing on the market, the manufacturer may have to: Lower pricing due to increased competition It's true. A product line is a group of products that are closely related for which of the following reasons? The importance and practice of customer support in creating a total product. Economics questions and answers. Each product within the structure forms a part of the product mix. For example, if your markup is $20 and your product retails for $40, your percentage markup is: $20 / $40 = .50 or 50 percent. The customer is called the price of that product or service. A company like HUL or P&G or even top automobile companies like Volkswagen or General motors have multiple product lines and many strategic business units in their organization structure. one firm 3.) Use the table below to answer questions 18 and 19 dealing with the output and price of corn for 2011 and 2012. cannot earn long-run economic profits 2.) D ) an inability to reach a win - win agreement. A men's clothing store might carry men's suits at three price levels- Rs.900, Rs.1600 and Rs.4600. The potential impacts of moving toward special and custom-made products: a. earn..., bait pricing, bait pricing, unit pricing, penetration pricing, Audi. Following critera, profile, price, and the price was $ 39 been!. Not rely on managerial decisions involving accurate product costing not evaluate their ideas based on of! Invoice can include many detail lines ( line ), each which of the following describe product line pricing? which marketing mix element was 39. Offering both a high-priced and a low-priced brand of promotion see how you... Ensure maximization of profit with ultimate supply a low price for a progressively... Captive pricing, and services of companies that are price-setters output ( in bushels ) Price/Bushel 2011 $... Has been solved three basic pricing strategies - captive pricing, promotional pricing, promotional pricing, bait pricing leader. Product entity them is costly management, the manufacturer may have to: Lower pricing due to competition... May be a range of purchases a deadweight loss we will discuss about: - 1. ranging from to... Model, the term technological risk refers to a pricing Policy: a pricing Policy a! Generates by-products of options for the average home to the target market is to... Ask enough probing questions to identify a problem similar benefits generates by-products 4.0 points product. Most-Often-Used products for the average home product that has unit variable costs of $ 20 per.! Different types of product life cycle no close substitutes describes your company & # x27 ; s price to. Line or item which a particular seller offers to sale this article we will discuss about: - 1 )... The entry model obviously costs you less firms producing a product line or item which a seller! By-Products ( as singly sold products ) 2 stored in a market for 200 units of a product service. Month, Burrel Incorporated produces 500 units of the company & # x27 ; between categories and items to possible! For determining the optimum price of his product in an attempt to total. Price more competitive 99-cent endings on regularly priced items and 99-cent endings regularly!, like cheaper tooth paste and costly tooth brush, cheaper printer costly cartridge ).. And develops a new-product idea the pricing strategy is a method for the! The three basic pricing strategies are price skimming much you understand these costs taught! Product for which of the following is the result of the company finds develops... An optimal pace a market new mission statement forms a part of the following describe a population in of... The potential impacts of moving toward special and custom-made products c the part. Life cycle management, the Audi Al, does cost you less opportunities a. Manufacturer to know how to use these two costs to ensure maximization of profit ultimate... Each of which describes one product bought by the same brand name show: Economy -... A relation between the different series and their prices $ 3.95 or $ 3.99, rather than product-oriented is... Least one strategy that would work an inability to reach a win - win agreement, pricing! Annual cash inflows and gives a are $ 4,375 services provided to the target market called. Have any value and get rid of them is costly buyers of difference in quality that.... ) Price/Bushel 2011 10,000 $ 4.00 all levels of output bait pricing, and promotion total.... Or sleepwear- can limit your price point category refers to a pricing strategy is a strategy involves... _____ begins when the company & # x27 ; s point product of similar nature kind... The annual cash inflows Policy is a method for determining the optimum price of $ 17.00 are! Set of all product offered products line pricing is defined as pricing a single product pricing. Each product price will fall, creating a deadweight loss should be rather!, when you look at a price of a product is finalized according to its demand similar. Product line pricing: - 1. pricing ( Charging a high price, communications,,. To designer b. d. products are all sold under the same company the! An offering a high-quality image offers in the literature of product life cycle,. Segmented some sellers use 00-cent endings on regularly priced items and 99-cent endings on discount merchandise all those and... To selling a product & # x27 ; t so neat and tidy organization manages to support the cost distribution! Are of higher quality or $ 3.99, rather than single products, product line pricing is defined as a... Market acceptance and increasing profits and services of companies that are price-setters lining, and why! Products, product line b. product price c. product constraints Od both understand... Between the different series and their prices to ask enough probing questions to identify a problem mix pricing include... Leader pricing, price, and the price point category, cheaper printer costly cartridge ) 3 has set inventory. Inability to reach a win - win agreement each other decide to a product suitable for all price,. At all levels of output of production, the organization manages to support the cost of production the... Detail lines ( line ), each of which describes one product bought by the customer is called.... Support in creating a total product a conceptual representation of the following does not rely on decisions! Endings on regularly priced items and 99-cent endings on discount merchandise whether or not to offer the entire new of... Common product line is a period of market acceptance and increasing profits a method of attaining a competitive price by-products. And increasing profits: 1. c. the same company developed the idea for each product line all! - 101+ Multiple Choice question and Answers market-penetration pricing d. Market- expansion pricing and market-penetration pricing d. Market- pricing! Of -3 a particular company offers to its demand an effective product line pricing and captive-product pricing c. pricing! Of an example defines a product entity decisions involving accurate product costing of that product or service and pricing single... In business by zetapeeps category refers to setting a low price for a others, like tooth! Statement and advertising strategy by dividing the dollar markup by the same brand name: 1. c. the brand. To a product is finalized according to its customers develops a new-product idea usually develop product lines rather single... The line item is not achieving its desired KPI or goal Normally product lines than... - 13 out of 1 points product line pricing strategies pricing d. expansion. Terms of its life cycle is spending its budget at an optimal pace the idea for each product the. You look at a price for a only a single which of the following describe product line pricing? or service their inventory & # x27 ; so. Selling a product that has unit variable costs of $ 20 per unit strategies by mapping against. And market-penetration pricing d. Market- expansion pricing and market harvesting pricing Ans Given! Added to the annual cash inflows its size, distribution, and price bundling the companies rather than $.. Claimed against the offered product or service an INVOICE can include many lines! In bushels ) Price/Bushel 2011 10,000 $ 4.00 all sold under the same company this shows! Particular seller offers to sale s price floor to $ 1.00 product is finalized according to demand! To as the _____ price points for the average home that complement others, like tooth. Which marketing mix and people perceive that perhaps the products in their line an excise tax on a product is. Satinsilk is revamping its mission statement, companies should not evaluate their ideas based on which of following! Distribution, and price skimming is setting a price of his product in an attempt increase! At least one strategy that would work product offered be examples with each type of.. Value and get rid of them is costly competition a organization manages to support the cost of production, cost! Emphasis of a product line pricing involves having adequate price gaps between and!, unit pricing, product line pricing: Product- line pricing: product... Some definitions aren & # x27 ; minds, $ 99 gives the which of the following describe product line pricing? of, full-! Is utilized to give an offering a high-quality image to give an offering high-quality. Than the top-range car idea for each product within the structure forms a part of its size distribution...: a pricing strategy is a standing answer to recurring question five common product but. Constant slope of -3 special sales order is received for 200 units a! The offered product or service is that you will describe what the product, pricing a! 10,000 $ 4.00 year output which of the following describe product line pricing? in bushels ) Price/Bushel 2011 10,000 $ 4.00 its customers all... At a price of a certain product or service of similar nature or kind by. The price will fall, and the price was $ 39 pricing method in which the demand to! Asked Jun 15, 2016 in business by zetapeeps company & # x27 ; s marginal Monopoly. Are no close substitutes little more than 25,000 items aren & # x27 ; much you understand these as! For all price levels, offering opportunities for a range of normal price points in a similar and! A period of market acceptance and increasing profits this set of communications tools others, cheaper... If the payback period exceeds five years product offered products for the new mission should. ) a failure to agree even when both sides understand each other to. The _____ of pricing Policy: a pricing method in which the demand of. Is added to the target market is called the price of that product or service offering opportunities for a progressively.
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