Pricing Strategies Case Studies Quiz

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40 Questions

What is the primary purpose of psychological pricing?

To take advantage of consumer perceptions

In what situation is 'Going Rate Pricing' most effective?

When there is a clear price leader who controls the game

What is the main reason behind using odd prices in psychological pricing?

Consumers perceive odd prices to be lower than even ones

Why might a company use 'Going Rate Pricing' strategy?

To maintain a consistent price regardless of competitors' actions

What pricing strategy involves selling a product at a higher price due to high perceived value?

Value Pricing

In which pricing strategy does a firm charge a low price, often equal to costs, to penetrate a new market and gain market share?

Penetration Pricing

What is the short-term high price strategy used to 'milk' the market for a period of popularity?

Skimming or Milking

Which pricing strategy involves reducing prices to remove or deter new entrants in a price-sensitive market?

Barrier Pricing

What pricing strategy involves pricing a product below cost, therefore selling it at a loss?

Loss Leading

Why might a firm use loss leading as a pricing strategy?

To attract customers for other products

In which strategy does a firm use a long-term high price due to high perceived value of the product?

Value Pricing

What pricing strategy involves reducing prices to remove or deter new entrants in a price-sensitive market?

Barrier Pricing

What is the strategy of using barrier pricing first to deter or remove competitors, and then increasing prices after cornering the market?

Destroyer/Predatory Pricing

What are the problems associated with loss leading as a pricing strategy?

All of the above

In which pricing strategy does a firm price a product below cost to attract customers for other products?

Loss Leading

What is the pricing strategy used to penetrate a new market and gain market share by charging a low price, often equal to costs?

Penetration Pricing

Which pricing strategy involves setting a long-term high price due to high perceived value of the product?

Value Pricing

In which pricing strategy does a firm use a short-term high price to 'milk' the market for a period of popularity?

Skimming or Milking

What is the strategy of using barrier pricing first to deter or remove competitors, and then increasing prices after cornering the market?

Destroyer/Predatory Pricing

In which pricing strategy does a firm price a product below cost to attract customers for other products?

Loss Leading

What pricing strategy involves reducing prices to remove or deter new entrants in a price-sensitive market?

Barrier Pricing

What is the pricing strategy used to penetrate a new market and gain market share by charging a low price, often equal to costs?

Penetration Pricing

What pricing strategy involves selling a product at a higher price due to high perceived value?

Value Pricing

What is the short-term high price strategy used to 'milk' the market for a period of popularity?

Skimming or Milking

In which pricing strategy does a firm charge a low price, often equal to costs, to penetrate a new market and gain market share?

Penetration Pricing

What pricing strategy involves pricing a product below cost, therefore selling it at a loss?

Loss Leading

What is the strategy of using barrier pricing first to deter or remove competitors, and then increasing prices after cornering the market?

Destroyer/Predatory Pricing

In which pricing strategy does a firm use a long-term high price due to high perceived value of the product?

Value Pricing

Which pricing strategy involves setting a long-term high price due to high perceived value of the product?

Value Pricing

What is the strategy of using barrier pricing first to deter or remove competitors, and then increasing prices after cornering the market?

Destroyer/Predatory Pricing

What pricing strategy involves selling a product at a higher price due to high perceived value?

Value Pricing

What is the pricing strategy used to penetrate a new market and gain market share by charging a low price, often equal to costs?

Penetration Pricing

What pricing strategy involves reducing prices to remove or deter new entrants in a price-sensitive market?

Barrier Pricing

In which pricing strategy does a firm use a short-term high price to 'milk' the market for a period of popularity?

Skimming or Milking

What is the primary purpose of psychological pricing?

To influence consumer perception and behavior

Why might a firm use loss leading as a pricing strategy?

To attract customers for other products by selling at a loss

What is the short-term high price strategy used to 'milk' the market for a period of popularity?

Skimming or Milking

What pricing strategy involves pricing a product below cost, therefore selling it at a loss?

Loss Leading

Why might a company use 'Going Rate Pricing' strategy?

To maintain price consistency in the industry

What pricing strategy involves reducing prices to remove or deter new entrants in a price-sensitive market?

Barrier Pricing

Test your understanding of pricing strategies by tackling real-world case studies and applying the 7 pricing strategies. Assess your ability to consider factors influencing pricing and arrive at a strategic price for products.

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