Instrument Pricing Strategy Quiz

Parallel imports are often caused by differences in prices between countries due to tariffs and taxes.

A company can completely control the selling price of its products in all markets.

Price increases due to added costs produced by tariffs, taxes, and longer lines of distribution can lead to increased profits in foreign markets.

Cutting prices in foreign markets can lead to increased revenues when converted to the home currency.

Raising prices in a market can lead to a decrease in sales.

Price increases by executives can prevent parallel importing.

Parallel imports can result in the consumer blaming the brand owner for product failures, thus damaging the brand image.

Buying unauthorized imports ensures the same quality and warranty support as buying from authorized dealers.

Full-cost pricing involves considering only variable costs associated with producing and selling a product.

Variable-cost pricing is used when a firm wants to enter a market quickly.

Samantha is using full-cost pricing to sell her chocolates in Mexico.

Parallel imports can cause long-term damage to the market for trademarked products.

A company that sets prices to achieve specific objectives views its export sales as passive contributions to sales volume.

The more control a company has over the final selling price of a product, the worse it is able to achieve its marketing goals.

A producer can completely control the final selling price of a product when selling overseas.

Parallel imports occur when a wholesaler in one country buys more products than needed from a producer in another country.

Manufacturer's suggested retail price (MSRP) is the price that a retailer recommends to the consumer.

A company that sets a low price to cover costs without considering making large profits views prices as an active instrument.