Chapter 5: Managing Pricing Functions & Objectives
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Questions and Answers

What is the pricing strategy based on desired profit margin or rate of return on investment?

  • Value-based pricing
  • Demand-based pricing
  • Competitive-based pricing
  • Cost-based pricing (correct)
  • In competitive-based pricing, what influences prices more?

  • Production costs
  • Competition prices (correct)
  • Market demand
  • Consumer preferences
  • Which pricing strategy involves evaluating demand at varying price points?

  • Competitive-based pricing
  • Cost-based pricing
  • Value-based pricing (correct)
  • Premium pricing
  • What adjustment to cost-based pricing requires attention to target adopters' willingness to pay?

    <p>Value-based pricing</p> Signup and view all the answers

    Buyers are less price sensitive when a social product is perceived to be:

    <p>Unique</p> Signup and view all the answers

    Substitute-awareness effect states that buyers are less price sensitive when they are:

    <p>Unaware of substitute products</p> Signup and view all the answers

    What is the most important consideration in adjusting cost-based pricing according to the text?

    <p>Target adopters' willingness to pay</p> Signup and view all the answers

    When setting specific prices, what makes it easier?

    <p>Agreeing on a pricing objective</p> Signup and view all the answers

    What is the main focus of value-based pricing?

    <p>Target adopters' price sensitivity</p> Signup and view all the answers

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