Principles of marketing

1. 1. Pricing strategies usually change as the product passes through its ________ (life cycle)
2. Companies can choose between _______ broad strategies (two)
3. When Apple first introduced the iPhone, its initial price was high. It’s a example of _______
(market-skimming pricing)
4. For Market-Penetration Pricing the market must be _______ price sensitive so that a low price
produces more market growth. (highly)
5. Pricing is difficult because the various products have related _______ and face different degrees
of competition. (demand and costs)
6. A car buyer may choose to order a global positioning system (GPS) and Bluetooth wireless
communication. Itsa example of ________ (Optional Product Pricing)
7. Companies that make products that must be used along with a main product are using
_______(captive product pricing.)
8. In the case of services, captive product pricing is called __________ (two-part pricing.)
9. Producing products and services often generates __________ (byproducts)
10. Sellers often combine several products and offer the bundle at a_________ price. (reduced)
11. Price bundling can _______ the sales of products consumers might not otherwise buy, but the
combined price must be low enough to get them to buy the bundle. (promote)
12. ________ is a straight reduction in price on purchases during a stated period of time or of larger
quantities. (Discount)
13. A__________is a price reduction to buyers who buy merchandise or services out of season.
(seasonal discount)
14. ________ is prices that buyers carry in their minds and refer to when looking at a given product.
(reference price)
15. __________is temporarily pricing products below thelist price, and sometimes even below cost,to
increase short-run sales. (Promotional pricing)
16. The price of timber is low in Chittagon than Dhaka . It’s a example
of___________(Geographical pricing)
17. _______ falls between FOB-origin pricing and uniform-delivered pricing.( Zone pricing)
18. Dynamic pricing offers many ________ for marketers. ( advantages)
19. __________ play an important role in setting international prices. (Costs)
20. A successful price increase can greatly _______ profits. (improve)

2. Chapter 11 (Pricing Strategies)
Reg: 13-05510
1) In market skimming pricing, a company makes fewer but more profitable
sales.
2) Company set a high initial price in order to penetrate the market quickly &
deeply.
3) In market penetration pricing, management must decide on the price steps
to set between the various products.
4) In the optional product pricing, the options is a sticky problem.
5) In optional product pricing, products that must be with the main product.
6) In case of services, captive product pricing is called two part pricing.
7) If the by products have value and is costly this will affect the pricing of the
main product.
8) By product pricing, helps to make the price of the main product more
competitive.
9) In captive product pricing, combining several. Products and offering the
bundle at a reduced price.
10) Price bundling can promote the sales of products.
11) Dynamic pricing temporarily reducing prices to increase short run sales.
12) A financial discount also called a trade discount.
13) Allowances are another type of reduction from the list price.

3. 14) In segmented pricing, the company sells a product or service at fixed
price.
15) Segmented prices should reflect artificial real differences in
customer’s perceived value.
16) In psychological pricing, sellers consider the psychology of prices and not
simply the economics.
17) Zone pricing fall between FQB-origin pricing and uniform delivered
pricing.
18) Using freight absorption pricing strategy, the seller absorbs all or part of the
actual freight charges.
19) Deceptive pricing occurs when a seller states prices or price savings that
mislead consumers or are not actually available to consumers.
20) Price confusion results when firm’s employ pricing methods that make it
easy for consumers to understand just what price whey are really paying.
21) Major public policy issues in pricing take place at three levels.
22) Customers always interpret price changes in a straight forward way.
23) A successful price decrease cans greatly improve profits.
24) A company may cut prices in a drive to dominate the market through lower
costs.
25) Pricing decisions are often constrained by social and illegal issues.

4. Answer sheet
1.T
2.F
3.F
4.T
5.F
6.T
7.F
8.T
9.F
10.T
11.F
12.T
13.T
14.F
15.F
16.T
17.T
18.T
19.T
20.F
21.F
22.F
23.F
24.T
25.F

5. 1)How many strategies a company can choose in case of
new product pricing?
a) 4 b) 5 c) 2 d) 3
2)Setting high price at initial of new product is known as-a)
product line pricing b)captive product pricing
c)market skimming pricing d)segmented pricing
3)What helps to keep out the competition ?
a) high price b) low price c)high production d) low
profit
4)The high sales volume results in ---
a)increasing cost b) decline revenue c) falling cost d)
increase quality
5)How many product mix pricing strategies a company
can choose ?
a) 4 b) 6 c) 7 d) 5
6)What is the basis of product line pricing ?
a)profit maximization b) cost differences c)product
pricing d)changing quality

6. 7)Which strategy allows a company to sell accessory
products ?
a)optional product pricing b) captive product pricing
c) by product pricing d) product bundle pricing
8)Whom is known as captive product pricing ?
a) mix pricing b) two-part pricing c) single part d) none of
above
9) In which case price is broken into a fixed fee plus a
variable usage rate?
a) transport b)service c) raw materials d) by product
10)How many price adjustment strategies a company
should followed ?
a) 5 b) 8 c) 7 d) 9
11)Which is a price reduction to buyers who buy large
volumes ?
a)Quantity discount b)trade discount c) seasonal
discount d) cash discount
12)What is the judgement of a product quality ?

7. a)price b) cost c) discount d) allowances
13)Which is a major factor in price increase ?
a) cost inflation b) profit c) selling d) discount
14)When a competitor cut prices, a company’s first
reaction to be ---
a) increase price b) increase production c)drop price
d)decline selling
15) Which is constrained by pricing decision ?
a) social issues b) price issue c) cost issue d) production
issue
16)How many level should considered during pricing?
a) 3 b) 2 c) 5 d) 7
17)what occurs when seller states prices ?
a)deceptive pricing b) dynamic pricing c) scanner fraud
d) price confusion
18)what may differences in selling strategies ?
a)scanner fraud b) pricing structure c) basing point
pricing d) price escalation

8. ANSWER:
1)c 2) c 3) b 4) c 5) d 6) b 7) a 8) b 9) b 10) c 11)
a 12) a 13) a 14) c 15) a 16) b 17) a 18) d