The Grapes Of Wrath By John Steinbeck Essay - 1653 Words

In John Steinbeck’s novel The Grapes of Wrath, the hardships of the Great Depression lead the Californians and the Okies to treat each other kindly or harshly, based on their own concerns of the future. Social criticism and class conflict are primary themes in this novel because of the unjust treatment the Californians give to the Okies throughout the story, but this is not the only relationship Steinbeck focuses on. He also writes and explains the relationship among the Okies. Steinbeck was born in Salinas, California, where a part of this novel takes place, and Steinbeck uses his experience of working as a hired ranch hand during the Great Depression in the novel. The foundation of The Grapes of Wrath are the problems and tragedies that the Great Depression brings to the Okies. During the Great Depression, which lasted from 1929-1939, the stock market crashed and companies and businesses did as well. Banks lost life savings, leaving the majority of the United States broke. T hen, sandstorms that covered 5 million square miles of the Midwest left farmers without farms or money (â€Å"Grapes,† Novels 114). The bank had to force farmers out of their homes and these farmers and their families began migrating to California and were nicknamed â€Å"Okies†. Unfortunately, the Okies were hated by the Californians rather than welcomed. Many different kinds of people in California hated the Okies for various reasons. The first kind of people were the laborers. The laborers hated the OkiesShow MoreRelatedThe Grapes Of Wrath By John Steinbeck Essay1622 Words   |  7 Pages The Grapes of Wrath John Steinbeck, widely viewed as one of the most finest and powerful American writer, born to a middle-class family in 1902 in the Salinas Valley of California. Steinbeck is a writer who often spoke for the people. The Grapes of Wrath is a great movie, published in 1939, filled with many universal truths and views on human nature and society, especially where class is concerned. In the article, John Steinbeck The Grapes a wrath: A Call to Action says, â€Å"Steinbeck’s novel showcasedRead MoreThe Grapes Of Wrath By John Steinbeck1075 Words   |  5 PagesKirsten Lloyd Mr. Eldridge AP Junior English 21 August 2014 Grapes of Wrath â€Å"Sometimes even to live is an act of courage.† (Seneca), In the 1939 novel, The Grapes of Wrath by John Steinbeck, the reader accompanies the Joad family as they struggle to escape the crippling Dust Bowl of the mid- 1930’s. In hopes of establishing a new life for themselves after being forced off their land the family embark on a journey from Oklahoma to California in search of fruitful crops and steady work alongRead MoreThe Grapes Of Wrath By John Steinbeck1563 Words   |  7 Pages John Steinbeck’s novel, The Grapes of Wrath, depicts a migrant farming family in the 1930s. During this time, life revolved around the Great Depression and the Dust Bowl, making circumstances difficult for almost everyone involved, especially those who had little. This time of drought and despair caused people to lose hope in everything they’ve ever known, even themselves, but those who did not, put their hope in the â€Å"promised land† of California. Here, the grass was thought to be truly greenerRead MoreThe Grapes Of Wrath By John Steinbeck1189 Words   |  5 Pagesâ€Å"The Grapes of Wrath† Shortly after being released John Steinbeck’s book â€Å"The Grapes of Wrath† was banned because many critics viewed the novel as promoting communist propaganda, or socialist ideas. The ideas that many of these critics point to is Steinbeck’s depiction of the Big Banks/ Businesses as monsters, the comparison of Government camps to a utopia in contrast of the makeshift â€Å"Hoovervilles,† and the theme of the community before the individual, In his novel â€Å"The Grapes of Wrath† John SteinbeckRead MoreThe Grapes Of Wrath By John Steinbeck1093 Words   |  5 Pages In John Steinbeck s The Grapes of Wrath, Tom Joad and his family are forced from their home during the 1930’s Oklahoma Dust Bowl and set out for California along with thousands of others in search of jobs, land, and hope for a brighter future. The Grapes of Wrath is Steinbeck’s way to expound about the injustice and hardship of real migrants during the Depression-era. H e utilizes accurate factual information, somber imagery, and creates pathos, allowing readers connections to the Joad’s plightRead MoreThe Grapes Of Wrath By John Steinbeck1190 Words   |  5 PagesThe Grapes of Wrath April 14th, 1939, John Steinbeck published the novel, The Grapes of Wrath. The novel became an immediate best seller, with selling over 428,900 copies. Steinbeck, who lived through both the Great Depression and the Dust Bowl, sought to bring attention to how families of Oklahoma outdid these disasters. Steinbeck focuses on families of Oklahoma, including the Joads family, who reside on a farm. The Joad family is tested with hardship when life for them on their farm takesRead MoreThe Grapes of Wrath by John Steinbeck702 Words   |  3 PagesJohn Steinbeck’s use of the intercalary chapters in The Grapes of Wrath helps weave the reader’s sympathy of the Joad family into a more broad sympathy for the migrant farmers as a whole, in the hopes that the readers would then be compelled to act upon what they have read. During the Great Depression, people had a big disconnect about what was happening in various parts of the country. People often struggle to find sympathy for events when they can’t even visualize a person who is suffering throughRead MoreThe Grapes Of Wrath By John Steinbeck2144 Words   |  9 PagesThe Grapes of Wrath is a well-known beloved novel of American Literature, written by John Steinbeck and published in 1939. Whoever said a road is just a road has not read The Grapes of Wrath. From the time we read when Tom Joad, novel’s protagonist, returns home after four years in prison; the meaning of roads changed. Route 66, also known as the mother road the road of flight, was a lifeline road, which allowed thousands of families to pursue their hopes and dreams. This road is also the road thatRead MoreThe Grapes of Wrath by John Steinbeck1014 Words   |  5 PagesJohn Steinbeck’s novel, The Grapes of Wrath, was first written and later published in the 1939. Fr om the time of its publication to date, the exemplary yet a simple book has seen Steinbeck win a number of highly coveted awards including Pulitzer Prize in 1940 and later on Nobel Prize for Literature in 1962. Set at the time of the Great Depression, the book most remarkably gives a descriptive account of the Oklahoma based sharecropper Joad’ poor family in the light of economic hardship, homelessnessRead MoreThe Grapes Of Wrath By John Steinbeck1064 Words   |  5 PagesThe Grapes of Wrath, originated from a John Steinbeck’s book, a legendary film that focus on a major point of American history. The story follows the Joad family on their journey to California trying to survive the hardships. This film, focus on the social problems of America like the Dust bowl, The Great Depression, and industrialism. The Grapes of Wrath was filmed in a journalistic-documentary style, which displayed the realism of the epidemic in the thirties. The thirties the period The Grapes

How Do Bacteria Divide - 1600 Words

How do bacteria divide? Introduction Cytokinesis is the process of producing to progeny cells (Scitable by nature education, 2014); the main process by which bacteria reproduce is asexual producing genetically identical offspring. The most common process of cell division in bacteria is binary fission. In this essay I intend to explain some aspects of DNA replication and septation – including the synthesis of peptidoglycan in the new cell wall – using the model organism Escherichia coli. Also, I will discuss the role and function of Fts proteins in cell division. Finally, I will discuss some less common forms of bacterial cell division, cell division where FtsZ is absent and some key facts from reliable sources on all the topics covered in†¦show more content†¦Replication is completed at the terminus, this is directly opposite the origin. While the two nucleoids occupy the centre of the cell they prevent the binding of FtsZ which I will discuss later. The two origins formed during replication move away from each other to opposite ends of the cell; the rest of the strand following. Currently, microbiologists/scientists do not fully understand how the chromosomes are split between progeny cells as this has not been fully investigated – presently, the evidence suggests there are various mechanism to do this and it varies depending on the bacterial species (Wiley, J.M, Sherwood, L.M. and Woolverton, C.J. 2014). In optimal conditions E.coli has a generation time of 20 minutes, however it takes 40 minutes to replicate its genome alone. E.coli is capable of this generation time because the replication of its circular genome is bidirectional – one replicating on the lagging strand one on the leading strand. In addition to this it has multiple DNA replication forks and a new round of DNA replication is possible to begin before last one has ended Wiley, J.M, Sherwood, L.M. and Woolverton, C.J. 2014). This means that E.coli can make more than two copies of its chromosome a t a time which enables a shorter generation time than the time taken to replicate its genome as there are more chromosomes present to be inherited by progeny cells. With replication and chromosome portioning complete, septation –

Role of Geography in International Marketing Free Essays

Discussion Questions for Chapter 3 History and Geography: The Foundation of Culture Discussion Questions 1. Define: Manifest DestinySustainable development Roosevelt CorollaryMonroe Doctrine 2. Why study geography in international marketing? Discuss. We will write a custom essay sample on Role of Geography in International Marketing or any similar topic only for you Order Now Geography is a study of the physical characteristics of a particular region of the earth. Involved in this study are climate, topography, and population. The interaction of the physical characteristics is one of the principal determinants of a country’s customs, products, industries, needs, and methods of satisfying those needs.Marketing is concerned with satisfying the needs of people. International marketing seeks out the whole world as its marketplace. Therefore, for an international marketer to know how to satisfy the needs of the international market, he must be familiar enough with geography to know what the various causal factors of the people’s needs are. He must know that various climates and topographies do exist and that they are vital in shaping the marketing plans that an international marketer must make. As an example, a producer selling machinery in the tropics would have to realize that special protection is needed to keep a machine running properly in hot and humid climates. 3. Why study a country’s history? Discuss History helps define a nation’s â€Å"mission,† how it perceives its neighbors, how it sees its place in the world, and how it sees itself. Insights into the history of a country are important for understanding attitudes about the role of government and business, the relations between managers and the managed, the sources of management authority, and attitudes toward foreign corporations.To understand, explain, and appreciate a people’s image of itself and the attitudes and unconscious fears that reflected in its view of foreign cultures, it is necessary to study the culture as it is now as well as to understand the culture as it was—that is, a country’s history. Unless you have a historical sense of the many changes that have buffeted Japan—seven centuries under the shogun feudal system, the isolation before he coming of Admiral Perry in 1853, the threat of domination by colonial powers, the rise of new social classes, Western influences, the humiliation of World War II, and involvement in the international community—it is difficult to fully understand its contemporary behavior. Loyalty to family, to country, to company, and to social groups and the strong drive to cooperate, to work together for a common cause, permeate many facets of Japanese behavior and have historical roots that date back thousands of years. Loyalty and service, a sense of responsibility, and respect for discipline, training, and artistry have been stressed since ancient times as necessary for stability and order. Confucian philosophy, taught throughout Japan’s history, emphasizes the basic virtue of loyalty â€Å"of friend to friend, of wife to husband, of child to parent, of brother to brother, but, above all, of subject to lord,† that is, to country. A fundamental premise of Japanese ideology reflects the importance of cooperation for the collective good. Japanese achieve consensus by agreeing that all will unite against outside pressures that threaten the collective good.A historical perspective gives the foreigner in Japan a basis on which to begin developing cultural sensitivity and a better understanding of contemporary Japanese behavior. 4. How does an understanding of history help an international marketer? To understand, explain, and appreciate a people’s image of itself and the fundamental attitudes and unconscious fears that are often reflected in its view of foreign cultures, it is necessary to study the culture as it is now as well as to understand culture as it was, that is, a country’s history. An awareness of the history of a country is particularly effective for understanding attitudes about the role of government and business, the relations between managers and the managed, the sources of management authority, and attitudes toward foreign MNC’s. History is what helps define a nation’s â€Å"mission,† how it perceives its neighbors, and how it sees its place in the world. To understand a country’s attitudes, prejudices, and fears it is necessary to look beyond the surface or current events to the inner subtleties of the country’s entire past for clues. 5.Why is there a love/hate relationship between Mexico and the United States? Discuss. A crucial element in understanding any nation’s business and political culture is the subjective perception of its history. To a Mexican, the United States is seen as a threat to their political, economic, and cultural independence. To most citizens in the United States, the causes for such feelings are a mystery. After all, the U. S. has always been Mexico’s â€Å"good neighbor. † Most would agree with President Kennedy’s proclamation during a visit to Mexico, â€Å"Geography has made us neighbors, tradition has made us friends. North Americans may be surprised to learn that most Mexicans felt it more accurate to say, â€Å"Geography has made us closer, tradition has made us far apart. † North Americans feel they have been good neighbors. They see the Monroe Doctrine as protection for Latin America from European colonization and the intervention of Europe in the governments of the Western Hemisphere. Latin Americans tend to see the Monroe Doctrine as an offensive expression of U. S. influence in Latin America. Or to put it another way, â€Å"Europe keep your hands off, Latin American is only for the United States. United States Marines sing with pride of their exploits â€Å"form the Halls of Montezuma to the shores of Tripoli. † To the Mexican, the â€Å"Halls of Montezuma† is remembered as U. S. troops marching all the way to the center of Mexico City and extracting as tribute 890,000 square miles that included Texas, New Mexico, Arizona and California. Most U. S. citizens probably do not know of the boy heroes of Chaptultepec Park but every Mexican can recount the heroism of â€Å"Los Ninos Heroes,† and the loss of Mexican territory to the United States. 6. Some say the global environment is a global issue rather than a national one. What does this mean? Discuss. Many view the problem as a global issue rather than a national one. One report on the global environment stressed . . . â€Å"it is quite clear that a number of critical problems—the threat to the ozone layer, the greenhouse effect, the loss of biodiversity, and ocean pollution—cannot be addressed by nations in isolation. † Companies looking to build manufacturing plants in countries with more liberal pollution regulations than they have at home are finding that regulations everywhere are becoming stricter. Many Asian governments are drafting new regulations and strictly enforcing existing ones.A strong motivator for Asia and the rest of the world is the realization that pollution is on the verge of getting completely out of control. Neither Western Europe nor the rest of the industrialized world are free of environmental damage; rivers are polluted and the atmosphere in many major urban areas is far from clean. The very process of controlling industrial wastes leads to another and perhaps equally critical issue: the disposal of hazardous waste, a by-product of pollution control. Estimates of hazardous wastes collected annually exceed 300 million tons; the critical question is disposal that does not move the problem elsewhere.The business community is responding positively to the notion that the focus must be on the global environment rather than â€Å"the quality of the air, land, and water in our own backyards. † An International Chamber of Commerce Industry Forum on the envir onment reflected a shift in company attitudes toward environmental issues away from a reactive and largely defensive stance to a proactive and constructive approach. Some skeptics may dismiss such statements as â€Å"window dressing† and they could be, but the beginning of change is awareness.Responsibility for cleaning up the environment does not rest solely with governments, businesses, or activist groups. Each citizen has social and moral responsibility to include environmental protection among his/her highest goals. 7. Pick a country and show how employment and topography affect marketing within the country. Library project. 8. Pick a country (other than Mexico) and show how significant historical events have affected the country’s culture. Library Project 9. Discuss the bases of world trade. Give examples illustrating the different bases. The basis for world trade is the differences between countries.One of these differences is the difference between people. Different heritages have resulted in the development of certain unique skills in the people of a country. An example would be the watchmaking skill developed by the Swiss. Thus, they have a unique skill on which to base trade. Another difference is the one of differing stages of economic development existing in the world today. Some countries are highly developed and industrialized. These nations, such as the United States and France, might be trading in luxuries, whereas an underdeveloped nation, such as Kenya, might be forced to trade only in essential capital goods.A third difference in countries serving as a basis for world trade is the availability of natural resources. Great Britain, poor in mineral resources, imports petroleum, where West Germany, rich in mineral resources but not food, imports large amounts of fruits and vegetables. Thus, trade is created by these differences: (1) Differences in skills – other countries seek the products of skills, (2) differences in economies – countries seek products they don’t produce but need, and (3) differences in national resources – countries buy and sell resources which they do not have or have an abundance of. 0. The marketer â€Å"should also examine the more complex effect of geography upon general market characteristics, distribution systems, and the state of the economy. † Comment. There can be no doubt that geography has had a â€Å"complex effect upon general market characteristics, distribution systems, and the state of the economy. † Therefore, the world marketer should be careful not to look just at how his product must be changed to fit into a foreign market. That is, he must not just fit his electric motors, say, with high-temperature operating characteristics and stop there. There’s more to it than that. Consider the diverse nature of South America, for example. The channels of distribution that a domestic marketer has been accustomed to using might not even exist because of natural barriers. These same natural barriers also cause quite varied levels of economic development within the same country. Cities and rural areas might not even be on the same economic plane. Finally, as a result of these barriers and thus physical isolation of various population centers, areas of the same economic development might have entirely different cultures.Therefore, the general market characteristics of these areas would also differ greatly and have a direct effect upon the success of marketing plans. 11. The world population pattern trend is shifting from rural to urban areas. Discuss the marketing ramifications There are many marketing ramifications to the world rural-urban population shift. One of the obvious ones is that the world market is becoming more unified in location. Thus, it is becoming easier to reach a larger segment of the market by just marketing in the urban population centers. The types of products marketed will also change with this population shift.For example, food might become a more important product in international marketing with few people raising their own. Similarly, these shifts will result in greater industrialization in countries with presently low levels of industrialization. This again implies marketing changes that might affect the world marketer, increased sales of capital goods, for example. In summary, people living in cities have different needs than those living in the country. Thus, the shift from country to city means that the world marketer has a different market to serve with different characteristics. 12.Select a country with a stable population and one with a rapidly growing population. Contrast the marketing implications of these two situations. Library Project 13. â€Å". . . world trade routes bind the world together . . . † Discuss. World trade routes bind the world together. This statement means that the world trade routes serve as avenues of minimizing differences between countries. Without these routes, countries would stand alone – each different from the rest in resources, economy, and people. The trade routes allow both people and products to flow, making more of a unified, balanced world.The physical imbalances overcome, also smooth, cultural and economic differences through the exchange of ideas as well as products. 14. Discuss how your interpretation of Manifest Destiny and the Monroe Doctrine might differ from a Latin American’s. Manifest Destiny and the Monroe Doctrine were accepted basis for U. S. foreign policy during much of the 19th and 20th centuries. Manifest Destiny, in its broadest interpretation, meant that Americans were a chosen people ordained by God to create a model society. More specifically, it referred to the desires of American expansionists in the 1840s to extend the U.S. boundaries from the Atlantic to the Pacific; the idea of â€Å"Manifest Destiny† was used to justify U. S. annexation of Texas, Oregon, New Mexico, and California; and later, U. S. involvement in Cuba, Alaska, Hawaii and the Philippines. The Monroe Doctrine, a cornerstone of U. S. foreign policy, was enunciated by President James Monroe in a public statement proclaiming three basic dicta: no further European colonization in the New World, abstention of the U. S. from European political affairs, and nonintervention of European governments in the governments of the Western Hemisphere.After 1870, interpretation of the Monroe Doctrine became increasingly broad. In 1881, its principles were evoked in discussing the development of an interoceanic canal across the Isthmus of Panama. The Monroe Doctrine was further applied by Theodore Roosevelt with what became known as the Roosevelt Corollary to the Monroe Doctrine. The corollary stated that not only would the U. S. prohibit non-American intervention in Latin American affairs but it would police the area and guarantee that Latin American nations met their international obligations. The corollary sanctioning American intervention was applied in 1905 when Roosevelt forced he Dominican Republic to accept the appointment of an American economic advisor who quickly became the financial director of the small state; it was used in the acquisition of the Panama Canal Zone from Colombia and the formation of a provisional government in Cuba in 1906. According to U. S. history, these Latin American adventures were a justifiable part of our foreign policy; to Latin Americans, they were unwelcome intrusions in Latin American affairs. The way historical events are recorded and interpreted in one culture can differ substantially from those same events recorded and interpreted in another. A comparison of histories goes a long way in explaining the differences in outlooks and behavior of people on both sides of the border. Many Mexicans believe that their â€Å"good neighbor† to the North is not reluctant to throw its weight around when it wants something. There are suspicions that self-interest is the primary motivation in good relations with Mexico, whether it be fear of Fidel Castro 25 years ago or eagerness for Mexican oil today. 15. The telegraph, telephone, television, satellites, computer, and the Internet have all had an effect on how international business operates.Discuss how each of these communications innovations affects international business management. An underpinning of all commerce is effective communications, knowledge of where goods and services exist and where they are needed and the ability to communicate instantaneously across vast distances. Facilitating the expansion of trade have been continuous improvements in electronic communications. First came the telegraph, then the telephone, television, satellites, the computer and the Internet. Each revolution in electronic technology has had a profound effect on human conditions, economic growth and the manner in which commerce functions.As each â€Å"new† communications technology has had its impact, new business models have been spawned and some existing businesses re-invented to adapt to the new technology while other businesses have failed to respond and thus ceased to exist. The Internet revolution will be no different; it too affects human conditions, economic growth, and the manner in which commerce operates. As we will discuss in subsequent chapters, the Internet has already begun to shape how international business is managed. However, as the Internet permeates the fabric of the world’s cultures, the biggest changes are yet to come! How to cite Role of Geography in International Marketing, Papers

Define and Discuss the Ideas of Global Orientation free essay sample

Market share leadership C) Price D) Product quality leadership E) The target market Answer: C Diff: 1Page Ref: 290 Skill: Concept Objective: 10-1 4) Consumer perceptions of the products value set the ________ for prices. A) demand curve B) floor C) ceiling D) variable cost E) image Answer: C Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 5) Product costs set a(n) ________ to a products price. A) demand curve B) floor C) ceiling D) break-even cost E) experience curve Answer: B Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 6) Which of the following is a customer-oriented approach to pricing? A) value-based pricing B) sealed-bid pricing C) break-even pricing D) target profit pricing E) C and D Answer: A Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 7) ________ uses buyers perceptions of what a product is worth, not the sellers cost, as the key to pricing. A) Value-based pricing B) Value-added pricing C) Variable cost D) Price elasticity E) Product image Answer: A Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 8) In ________, price is considered along with the other marketing mix variables before the marketing program is set. A) value-based pricing B) cost-based pricing C) variable costs D) price elasticity E) building the marketing mix Answer: A Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 9) Value-based pricing is the reverse process of ________. A) variable cost pricing B) cost-plus pricing C) cost-based pricing D) good-value pricing E) value-added pricing Answer: C Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 10) With ________, price is set to match consumers perceptions of product value. A) variable cost pricing B) cost-plus pricing C) cost-based pricing D) value-based pricing E) every day low pricing Answer: D Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 11) Measuring ________ can be difficult. A company might conduct surveys or experiments to test this in the different products they offer. A) price elasticity B) the demand curve C) perceived value D) break-even pricing E) quantity supplied Answer: C Diff: 3Page Ref: 292 AACSB: Communication Skill: Concept Objective: 10-2 12) Underpriced products sell very well, but they produce less revenue than they would have if price were raised to the ________ level. A) perceived B) value-based C) variable D) demand curve E) price-floor Answer: A Diff: 2Page Ref: 292 Skill: Concept Objective: 10-2 3) If a seller charges ________ than the buyers perceived value, the companys sales will ________. A) more; benefit B) more; suffer C) less; increase D) less; suffer E) none of the above Answer: B Diff: 2Page Ref: 292 Skill: Concept Objective: 10-2 14) Some companies have adopted a ________ strategy, offering just the right combination of quality and good service at a fair price. A) val ue-based pricing B) good-value pricing C) cost-plus pricing D) low-price image E) none of the above Answer: B Diff: 1Page Ref: 293 Skill: Concept Objective: 10-2 15) Wal-Mart is famous for using what important type of value pricing? A) competition-based pricing B) everyday low pricing C) cost-plus pricing D) break-even pricing E) penetration pricing Answer: B Diff: 2Page Ref: 293 Skill: Concept Objective: 10-2 16) ________ involves charging a constant, everyday low price with few or no temporary price discounts. A) High-low pricing B) Target pricing C) Cost-plus pricing D) EDLP E) Penetration pricing Answer: D Diff: 2Page Ref: 293 Skill: Concept Objective: 10-2 17) ________ involves attaching features and services to differentiate a companys offers and to support charging higher prices.. A) Break-even pricing B) Target pricing C) Value-added pricing D) Cost-plus pricing E) Pricing-down Answer: C Diff: 1Page Ref: 293 Skill: Concept Objective: 10-2 18) ________ is a companys power to escape price competition and to justify higher prices and margins. A) Variable cost B) Pricing power C) Target cost D) Fixed cost E) Unit cost Answer: B Diff: 2Page Ref: 293 Skill: Concept Objective: 10-2 19) To maintain and increase a companys ________, a firm must retain or build the value of its marketing offer. A) variable cost B) pricing power C) target cost D) fixed cost E) image Answer: B Diff: 3Page Ref: 293 Skill: Concept Objective: 10-2 0) When there is price competition, many companies adopt ________ rather than cutting prices to match competitors. A) pricing power B) value-added strategies C) fixed costs D) price elasticity E) image pricing Answer: B Diff: 2Page Ref: 293 Skill: Concept Objective: 10-2 21) Ryanair offers free flights to a quarter of its customers and rock-bottom prices to many of its other customers. Ryanair then charges for all extra services, such as baggage handling and in-flight refreshments. Which of the following best describes Ryanairs pricing method? A) value-added pricing B) low-cost pricing C) cost-plus pricing D) high-low pricing E) image pricing Answer: B Diff: 2Page Ref: 295 Skill: Concept Objective: 10-2 22) ________ pricing involves setting prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for the companys efforts and risks. A) Value-based B) Fixed cost C) Cost-based D) Variable E) Skimming Answer: C Diff: 1Page Ref: 295 Skill: Concept Objective: 10-3 23) Fixed costs ________ as the number of units produced increases. A) decrease B) increase C) divide in half D) remain the same E) increase at a diminishing rate Answer: D Diff: 2Page Ref: 295 Skill: Concept Objective: 10-3 24) Costs that do not vary with production or sales level are referred to as ________. A) fixed costs B) variable costs C) target costs D) total costs E) unit costs Answer: A Diff: 1Page Ref: 295 Skill: Concept Objective: 10-3 25) Rent, electricity and executive salaries are examples of ________. A) fixed costs B) variable costs C) accumulated costs D) total costs E) marketing costs Answer: A Diff: 2Page Ref: 295 Skill: Concept Objective: 10-3 26) Costs that vary directly with the level of production are referred to as ________. A) fixed costs B) variable costs C) target costs D) total costs E) unit costs Answer: B Diff: 1Page Ref: 296 Skill: Concept Objective: 10-3 27) ________ are the sum of the ________ and ________ for any given level of production. A) Fixed costs; variable; total costs B) Fixed costs; total; variable costs C) Variable costs; fixed; total costs D) Total costs; fixed; variable costs E) Break-even costs; fixed; total costs Answer: D Diff: 2Page Ref: 296 Skill: Concept Objective: 10-3 28) SRAC is the acronym for which concept related to costs at different levels of production? A) strategic reasoning and costs B) short-run accounting costs C) short-run average cost D) strategic rights and company E) strategic revenues and costs Answer: C Diff: 2Page Ref: 296 Skill: Concept Objective: 10-3 29) As production workers become better organized and more familiar with equipment, the average cost per unit decreases. This is called the ________. A) demand curve B) experience curve C) short-run average cost curve D) long-run average cost curve E) marginal utility Answer: B Diff: 1Page Ref: 296 Skill: Concept Objective: 10-3 30) With a higher volume of product, most companies can expect to ________. A) gain economies of scale B) become less efficient C) see average costs increase D) have a straight, horizontal learning curve E) find competitors using the experience curve strategically Answer: A Diff: 2Page Ref: 296 Skill: Concept Objective: 10-3 31) The experience curve reveals that ________. A) repetition in production lowers costs B) repetition in production enhances efficiency C) the average cost drops with accumulated production experience D) A, B, and C E) none of the above Answer: D Diff: 3Page Ref: 296 Skill: Concept Objective: 10-3 32) When a downward-sloping experience curve exists, a company should usually ________ the selling price of that product in order to bring in higher revenues. A) increase B) greatly increase C) decrease D) not alter E) none of the above Answer: C Diff: 3Page Ref: 297 Skill: Concept Objective: 10-3 33) Which of the following is a risk a company takes when building a strategy around the experience curve? A) Competitors will likely not be able to meet the companys price cuts. B) Existing technologies are likely to become more expensive as the company expands. C) The method does not take competitors prices into account. D) The method may cause consumers to become frustrated with changing prices. E) Aggressive pricing may give the product a cheap image, causing customers to lose interest. Answer: E Diff: 2Page Ref: 297 Skill: Concept Objective: 10-3 34) A company building its pricing strategy around the experience curve would be likely to ________. A) price its products low B) price its products high C) engage in break-even pricing D) all of the above E) none of the above Answer: A Diff: 3Page Ref: 297 Skill: Concept Objective: 10-3 35) The company designs what it considers to be a good product, totals the expenses of making the product, and sets a price that adds a standard mark-up to the cost of the product. This approach to pricing is called ________. A) value-based pricing B) fixed cost pricing C) cost-plus pricing D) variable pricing E) skimming pricing Answer: C Diff: 1Page Ref: 297 Skill: Concept Objective: 10-3 36) Lawyers, accountants, and other professionals typically price by adding a standard markup for profit. This is known as ________. A) variable costs B) cost-plus pricing C) value-based pricing D) break-even price E) penetration pricing Answer: B Diff: 2Page Ref: 297 Skill: Concept Objective: 10-3 37) The simplest pricing method is ________. A) value-based pricing B) going-rate and sealed-bid pricing C) cost-plus pricing D) break-even analysis E) target profit pricing Answer: C Diff: 2Page Ref: 297 Skill: Concept Objective: 10-3 38) Which of the following is a reason why markup pricing is NOT practical? A) Sellers earn a fair return on their investment. B) By tying the price to cost, sellers simplify pricing. C) When all firms in the industry use this pricing method, prices tend to be similar. D) This method ignores demand. E) With a standard markup, consumers know when they are being overcharged. Answer: D Diff: 3Page Ref: 298 Skill: Concept Objective: 10-3 39) One reason ________ remains popular is that sellers are more certain about costs than about demand. A) markup pricing B) variable pricing C) inelasticity pricing D) elasticity pricing E) penetration pricing Answer: A Diff: 2Page Ref: 298 Skill: Concept Objective: 10-3 40) Price competition is minimized when all firms in an industry use which pricing method? A) variable pricing B) markup pricing C) elasticity pricing D) value-added pricing E) value-based pricing Answer: B Diff: 3Page Ref: 298 Skill: Concept Objective: 10-3 41) Many people feel that ________ pricing is fairer to both buyers and sellers. Sellers earn a fair return on their investment but do not take advantage of buyers when buyers demand becomes great. A) variable B) markup C) elasticity D) inelasticity E) penetration Answer: B Diff: 2Page Ref: 298 AACSB: Ethical Reasoning Skill: Concept Objective: 10-3 42) Which of the following is a cost-based approach to pricing? A) value-based pricing B) going-rate pricing C) target profit pricing D) good value pricing E) A and C Answer: C Diff: 2Page Ref: 298 Skill: Concept Objective: 10-3 43) Break-even pricing, or a variation called ________, is when the firm tries to determine the price at which it will break even or make the profit it is seeking. A) competition-based pricing B) target profit pricing C) fixed cost pricing D) value-based pricing E) customer-based pricing Answer: B Diff: 1Page Ref: 298 Skill: Concept Objective: 10-3 44) Target profit pricing uses the concept of a ________, which shows the total cost and total revenue expected at different sales volume levels. A) value-based chart B) break-even chart C) competition-based chart D) demand-curve E) unit cost Answer: B Diff: 2Page Ref: 298 Skill: Concept Objective: 10-3 45) The break-even volume is the point at which ________. A) the total revenue and total costs lines intersect B) demand equals supply C) the production of one more unit will not increase profit D) the company can pay all of its long-term debt E) a firms profit goal is reached Answer: A Diff: 3Page Ref: 298 Skill: Concept Objective: 10-3 46) ________ pricing works only if that price actually brings in the expected level of sales. A) Elasticity B) Markup C) Variable D) Inelasticity E) Target profit Answer: E Diff: 3Page Ref: 298 Skill: Concept Objective: 10-3 47) Which of the following statements about break-even analysis is true? A) It is used to determine how much production experience a company must have to achieve desired efficiencies. B) It is a technique used to calculate fixed costs. C) It determines the amount of retained earnings a company will have during an accounting period. D) It is a technique marketers use to examine the relationship between supply and demand. E) It is calculated using variable costs, the unit price, and fixed costs. Answer: E Diff: 3Page Ref: 298 Skill: Concept Objective: 10-3 48) As a manufacturer increases price, the ________ drops. A) target B) break-even volume C) cost-plus pricing D) total cost E) sales Answer: B Diff: 3Page Ref: 299 Skill: Concept Objective: 10-3 49) Which of the following is an external factor that affects pricing decisions? A) the salaries of production management B) competition C) the salaries of finance management D) funds expensed to clean production equipment E) A, B, and C Answer: B Diff: 1Page Ref: 299 Skill: Concept Objective: 10-4 50) ________ that influence pricing decisions include the nature of the market and demand and competitors prices. A) Internal factors B) Elasticity factors C) External factors D) Target factors E) Domestic factors Answer: C Diff: 2Page Ref: 299 Skill: Concept Objective: 10-4 51) Companies may set prices low for which of the following reasons EXCEPT ________. A) to prevent competition from entering the market B) to stabilize the market C) to create excitement for a product D) to prepare for an easy exit from a market E) to match a competitor Answer: D Diff: 2Page Ref: 299 Skill: Concept Objective: 10-4 52) In order to form a consistent and effective integrated marketing program, price decisions should be coordinated with each of the following EXCEPT ________. A) product design B) distribution C) competitors prices D) promotion decisions E) marketing objectives Answer: C Diff: 2Page Ref: 299 Skill: Concept Objective: 10-4 53) With target costing, marketers will first ________ and then ________. A) build the marketing mix; identify the target market B) identify the target market; build the marketing mix C) design the product; determine its cost D) use skimming pricing; penetrating pricing E) determine a selling price; target costs to ensure that the price is met Answer: E Diff: 2Page Ref: 300 Skill: Concept Objective: 10-4 54) Price setting is usually determined by ________ in small companies. A) top management B) marketing departments C) sales departments D) divisional managers E) cross-functional teams Answer: A Diff: 2Page Ref: 300 Skill: Concept Objective: 10-4 55) Price setting is usually determined by ________ in large companies. A) top management B) divisional managers C) product line managers D) pricing departments E) both B and C Answer: E Diff: 2Page Ref: 300 Skill: Concept Objective: 10-4 56) In industrial markets, ________ typically has the final say in setting the pricing objectives and policies of a company. A) the sales manager B) top management C) the production manager D) the finance manager E) the pricing department Answer: B Diff: 2Page Ref: 300 Skill: Concept Objective: 10-4 57) In industries in which pricing is a key factor, ________ often set the best prices or help others in setting them. A) sales managers B) top managers C) production managers D) finance managers E) pricing departments Answer: E Diff: 2Page Ref: 300 Skill: Concept Objective: 10-4 58) Under ________, the market consists of many buyers and sellers trading in a uniform commodity such as wheat, copper, or financial securities. A) pure competition B) monopolistic competition C) oligopolistic competition D) a pure monopoly E) anti-trust agreements Answer: A Diff: 2Page Ref: 302 Skill: Concept Objective: 10-4 59) Under ________, the market consists of many buyers and sellers who trade over a range of prices rather than a single market price. A) pure competition B) monopolistic competition C) oligopolistic competition D) pure monopoly E) socialism Answer: B Diff: 2Page Ref: 302 Skill: Concept Objective: 10-4 60) Under ________, the market consists of a few sellers who are highly sensitive to each others pricing and marketing strategies. A) pure competition B) monopolistic competition C) oligopolistic competition D) pure monopoly E) capitalism Answer: C Diff: 2Page Ref: 302 Skill: Concept Objective: 10-4 61) Nonregulated monopolies are free to price at what the market will bear. However, they do not always charge the full price for a number of reasons. What is NOT one of those reasons? A) They dont want to attract competition. B) They want to penetrate the market faster with a low price. C) They have a fear of government regulation. D) They want to encourage government regulations. E) They want to please a large group of consumers. Answer: D Diff: 3Page Ref: 303 Skill: Concept Objective: 10-4 62) The relationship between the price charged and the resulting demand level can be shown as the ________. A) demand curve B) variable cost C) target cost D) break-even pricing E) experience curve Answer: A Diff: 1Page Ref: 303 Skill: Concept Objective: 10-4 63) Consumers usually perceive higher-priced products as ________. A) out of reach for most people B) having high quality C) having high profit margins D) having cost-based prices E) being in the introductory stage of the product life cycle Answer: B Diff: 3Page Ref: 303 Skill: Concept Objective: 10-4 64) Why do marketers consider prestige goods to be an exception to the typical demand curve? A) The demand curve for prestige goods slopes downward and to the right. B) Increasing the price of prestige goods can make them seem more desirable. C) Demand for prestige goods often is greater than supply. D) Prestige products such as diamonds, sapphires, and emeralds are nonrenewable resources. E) Customers are more aware of any price changes to prestige goods. Answer: B Diff: 3Page Ref: 303 Skill: Concept Objective: 10-4 65) Which of the following is true about the demand curve? A) It is used to illustrate the effect of price on the quantity supplied. B) It is always graphically depicted by a straight line. C) It shows the quantity of product customers will buy in a market during a period of time even if other factors change. D) It usually slopes upward and to the right. E) It shows the relationship between product demand and product price. Answer: E Diff: 3Page Ref: 303 Skill: Concept Objective: 10-4 6) When Gibson Guitar Corporation, long known for its high quality instruments, lowered its prices to compete more effectively with Japanese rivals, the company sold fewer guitars. Which of the following best explains this? A) The Gibson guitars were not as well made as the Japanese guitars. B) The market was already flooded with guitars. C) The sound of the Gibson guitar was not as good as the Japanese guitars. D) Customers did not distinguish the superiority of the Gibson guitar when it was at a lower price. E) Customers had come to expect a higher price for a Gibson guitar. Answer: D Diff: 3Page Ref: 303 Skill: Concept Objective: 10-4 67) ________ describes how responsive demand will be to a change in price. A) Price elasticity B) Break-even pricing C) The demand curve D) Target costing E) Supply Answer: A Diff: 1Page Ref: 304 Skill: Concept Objective: 10-4 68) If demand hardly changes with a small change in price, we say the demand is ________. A) variable B) inelastic C) value-based D) at break-even pricing E) market penetrating Answer: B Diff: 2Page Ref: 304 Skill: Concept Objective: 10-4 69) If demand changes greatly with a small change in price, we say the demand is ________. A) variable B) inelastic C) value-based D) elastic E) fixed Answer: D Diff: 1Page Ref: 304 Skill: Concept Objective: 10-4 70) Price elasticity of demand is ________ divided by ________. A) percent change in quantity demanded; percent change in price B) demand; price C) percent change in price; percent change in quantity demanded D) the going price; the asking price E) none of the above Answer: A Diff: 2Page Ref: 304 Skill: Concept Objective: 10-4 71) Buyers are less price sensitive in all of the following situations EXCEPT ________. A) when the product they are buying is unique B) when the product they are buying is in high demand C) when substitute products are hard to find D) when the total expenditure for a product is high relative to their income E) when the product is a specialty product Answer: D Diff: 2Page Ref: 304 Skill: Concept Objective: 10-4 72) The less ________ the demand, the ________ it pays for the seller to raise the price. A) determined; less B) elastic; more C) elastic; less D) constant; more E) none of the above Answer: B Diff: 3Page Ref: 304 Skill: Concept Objective: 10-4 73) Each of the following economic factors can have a strong impact on a firms pricing strategy EXCEPT ________. A) an economic boom B) the resellers reaction to price changes C) an economic recession D) inflation E) interest rates Answer: B Diff: 2Page Ref: 305 Skill: Concept Objective: 10-4 74) A company should set prices that will allow ________ to receive a fair profit. A) resellers B) producers C) consumers D) the elderly E) competitors Answer: A Diff: 2Page Ref: 305 Skill: Concept Objective: 10-4 75) When companies set prices, the government and social concerns are two ________ affecting pricing decisions. A) external factors B) internal factors C) economic conditions D) demand curves E) temporary influences Answer: A Diff: 1Page Ref: 305 Skill: Concept Objective: 10-4 76) Amos Zook, an Amish farmer, sells organically grown produce. Often he will trade some of his produce for dairy products produced by other Amish farmers. The sum of the values that others exchange is called a ________. A) price B) cost-plus price C) dynamic price D) common value price E) penetration price Answer: A Diff: 1Page Ref: 290 AACSB: Reflective Thinking Skill: Application Objective: 10-1 77) Trader Joes offers an assortment of exclusive gourmet products at impossibly low prices. These prices are not limited-time offers or special discounts. Instead, they reflect Trader Joes ________ strategy. A) everyday low pricing B) cost-plus pricing C) dynamic pricing D) value-based pricing E) cost-based pricing Answer: A Diff: 2Page Ref: 293 AACSB: Reflective Thinking Skill: Application Objective: 10-2 78) Jimmys Hardware, an independent local retailer, is losing business to Wal-Mart. This is most likely because he cannot match Wal-Marts pricing strategy of ________. A) EDLP B) EFGF C) fixed prices D) negotiated pricing E) skimming pricing Answer: A Diff: 2Page Ref: 293 AACSB: Analytic Skills Skill: Application Objective: 10-2 9) When McDonalds and other fast food restaurants offer value menu items at surprisingly low prices, they are using ________. A) break-even pricing B) target profit pricing C) value pricing D) cost-plus pricing E) bundling Answer: C Diff: 1Page Ref: 293 AACSB: Analytic Skills Skill: Application Objective: 10-2 80) Consumers who have less time and patience for watching for supermarket specials and clipping cou pons would most likely prefer ________. A) variable pricing B) high-low pricing C) EDLP D) break-even pricing E) value-based pricing Answer: C Diff: 3Page Ref: 293 AACSB: Analytic Skills Skill: Application Objective: 10-2 81) Xbox 360 decides to add a free subscription to XBOX magazine with every game bought in an effort to differentiate its offering from PS3 games. This is an example of ________. A) good-value pricing B) add-on pricing C) product-support pricing D) value-added pricing E) cost-based pricing Answer: D Diff: 2Page Ref: 293 AACSB: Reflective Thinking Skill: Application Objective: 10-2 82) The long-run average cost curve (LRAC) helps the producer understand which of the following? A) It shows how large a business should be, to be most efficient. B) It deals mainly with competitors prices. C) It deals mainly with external factors. D) all of the above E) none of the above Answer: A Diff: 2Page Ref: 296 AACSB: Analytic Skills Skill: Application Objective: 10-3 83) Assume a manufacturer with fixed costs of $100,000, a variable cost of $10, and expected sales of 50,000 units wants to earn a 20-percent markup on sales. What is the manufacturers markup price? A) $14 B) $15 C) $18 D) $18. 50 E) none of the above Answer: B Diff: 3Page Ref: 297 AACSB: Analytic Skills Skill: Application Objective: 10-3 84) General Motors prices its automobiles to achieve a 15 to 20 percent profit on its investment. This approach is called ________. A) value-based pricing B) going-rate pricing C) cost-plus pricing D) low-price image E) target-profit pricing Answer: E Diff: 2Page Ref: 298 AACSB: Reflective Thinking Skill: Application Objective: 10-3 85) A company faces fixed costs of $100,000 and variable costs of $8. 00/unit. They plan to directly sell their product to the market for $12. 00. How many units must they produce and sell to break even? A) 20,000 B) 25,000 C) 40,000 D) 50,000 E) not enough information to calculate Answer: B Diff: 2Page Ref: 298 AACSB: Analytic Skills Skill: Application Objective: 10-3 6) Ecstasy Pharmaceuticals faces fixed costs with their new drug of $1,000,000. The company sells the drug in bottles of 50 pills for $10. 00. They estimate that they must sell 200,000 bottles to break even. What is the total cost to produce a bottle of 50 pills? A) $2. 50 B) $5. 00 C) $6. 00 D) $7. 50 E) not enough information to calculate Answer: B Diff: 3Page Ref: 298 AACSB: Analytic Skills Skill: Application Objective: 10-3 87) A manufacturer is trying to determine its break-even volume. With fixed costs of $100,000, a variable cost of $10, and expected sales of 50,000 units, what should the manufacturers unit cost be to break even? A) $10 B) $12 C) $16 D) $20 E) none of the above Answer: B Diff: 3Page Ref: 298 AACSB: Analytic Skills Skill: Application Objective: 10-3 88) As a manufacturer decreases price, ________ volume increases. A) target B) break-even C) cost-plus pricing D) total cost E) sales Answer: B Diff: 3Page Ref: 299 AACSB: Analytic Skills Skill: Application Objective: 10-3 89) PG surveyed the market and identified an unserved segment of electric toothbrush market. Using these results, they created Spinbrush. The unorthodox order of this marketing mix decision is an example of ________. A) competition-based pricing B) cost-plus pricing C) target costing D) value-based pricing E) penetration pricing Answer: C Diff: 2Page Ref: 300 AACSB: Reflective Thinking Skill: Application Objective: 10-4 90) PoolPak produces climate-control systems for large swimming pools. The companys customers are more concerned about service support for maintaining a system than its initial price. PoolPak may use this knowledge to become more competitive through ________. A) target costing B) value pricing C) cost-plus pricing D) a nonprice position E) skimming pricing Answer: D Diff: 2Page Ref: 300 AACSB: Reflective Thinking Skill: Application Objective: 10-3 91) By pledging to be a leader in providing clean, renewable energy sources and developing products and services that help consumers protect the environment, Green Mountain Power competes successfully against cheaper brands that focus on more price-sensitive consumers. Green Mountain Power has the firm belief that even kilowatt-hours can be ________. A) cost-plus priced B) a demand curve C) differentiated D) value-based priced E) none of the above Answer: C Diff: 3Page Ref: 300 AACSB: Analytic Skills Skill: Application Objective: 10-4 92) In Vin del Mar, Chile, there are a dozen stores specializing in selling the same quality of seafood products on one street. An individual store dare not charge more than the going price without the risk of losing business to the other stores that are selling the fish at a common price. This is an example of what type of market? A) pure competition B) monopolistic competition C) oligopolistic competition D) pure monopoly E) socialist Answer: A Diff: 2Page Ref: 302 AACSB: Reflective Thinking Skill: Application Objective: 10-4 93) Ascot Tires has decided to decrease its prices. The company can expect that ________ for their product will increase. A) cost-plus pricing B) value-based pricing C) demand D) the experience curve E) competition Answer: C Diff: 1Page Ref: 303 AACSB: Reflective Thinking Skill: Application Objective: 10-4 94) If Canon Camera Company follows a high-price, high-margin strategy, what will competitors such as Nikon, Minolta, and Pentax most likely do? A) They will go out of business. B) They will want to compete against Canon. C) They will advertise less. D) They will bundle their products. E) none of the above Answer: B Diff: 2Page Ref: 304 AACSB: Analytic Skills Skill: Application Objective: 10-4 95) If Canon Camera Company follows a low-price, low-margin strategy for a product, what will competitors most likely do? A) They will not be able to compete or may leave the market. B) They will want to compete against Canon. C) They will advertise less. D) They will advertise more. E) none of the above Answer: A Diff: 3Page Ref: 304 AACSB: Analytic Skills Skill: Application Objective: 10-4 96) Companies are fortunate to have demand that is more ________ because they may be able to set higher prices. A) elastic B) external C) internal D) inelastic E) fixed Answer: D Diff: 2Page Ref: 304 AACSB: Analytic Skills Skill: Application Objective: 10-4 97) If demand falls by 1 percent when price is increased by 2 percent, then ________. A) elasticity is —1/2 B) demand is inelastic C) demand is elastic D) buyers are not price sensitive E) A and B Answer: E Diff: 3Page Ref: 304 AACSB: Analytic Skills Skill: Application Objective: 10-4 Refer to the scenario below to answer the following questions. Alden Manufacturing produces small kitchen appliances? blenders, hand mixers, and electric skillets? under the brand name First Generation. Alden attempts to target newlyweds and first-time home buyers with this brand. In considering that most young households have limited financial resources, Alden has attempted to engage in target costing. In doing this, Milt Alden stated, we have better control over keeping price right in line with customers. Alden manufactures a three-speed blender, its top seller, and a five-speed blender. The hand mixers are manufactured in two styles? a small hand-held mixer with two rotating beaters and a similar style that comes with an optional stand and attached mixing bowl. Aldens temperature-controlled skillets are manufactured in one style with three color options. Our product offerings are narrower, Milt Alden added, but our line workers know each product like the back of their hands. This allows us to produce superior products while holding our prices low. 98) Milt Alden says that his line workers know each product like the back of their hands, and that this knowledge helps the company keep its prices low. This indicates that Alden Manufacturing most likely uses w hich of the following strategies? A) cost-plus pricing B) value-based pricing C) the experience curve D) cost-based pricing E) target profit pricing Answer: C Diff: 2Page Ref: 296 AACSB: Analytic Skills Skill: Application Objective: 10-2 99) Milt Alden uses a target costing strategy. Which of the following is he most likely to do in executing this strategy? A) base his price on competitors prices B) use everyday low pricing C) use a break-even chart to determine pricing D) start with customer-value considerations E) start by determining the costs of a new product Answer: D Diff: 2Page Ref: 300 AACSB: Analytic Skills Skill: Application Objective: 10-4 100) If Alden raises the price on the handheld mixer by 2 percent and quantity demanded falls by 10 percent what is the price elasticity of demand? A) —5 B) —8 C) —12 D) 5 E) 12 Answer: A Diff: 3Page Ref: 304 AACSB: Analytic Skills Skill: Application Objective: 10-4 101) When faced with price competition cutting prices is often not the best answer. Answer: TRUE Diff: 2Page Ref: 293 AACSB: Analytic Skills Skill: Application Objective: 10-1 102) Prices have a direct impact on a companys bottom line. Answer: TRUE Diff: 1Page Ref: 290 Skill: Concept Objective: 10-1 103) Demand and consumer value perceptions set the floor for prices. Answer: FALSE Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 104) Product costs set a floor to the price; consumer perceptions of the products value set the ceiling. Answer: TRUE Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 105) Value-based pricing is being used when costs vary directly with the level of product. Answer: FALSE Diff: 3Page Ref: 291 Skill: Concept Objective: 10-2 106) Value-based pricing uses the companys perception of value. Answer: FALSE Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 107) Value-based pricing is the reverse of cost-based pricing. Answer: TRUE Diff: 2Page Ref: 291 Skill: Concept Objective: 10-2 108) Using value-based pricing, a marketer would not design a product and marketing program before setting the price. Answer: TRUE Diff: 3Page Ref: 291 AACSB: Analytic Skills Skill: Application Objective: 10-2 109) EDLP is very similar to high-low pricing. Answer: TRUE Diff: 2Page Ref: 293 Skill: Concept Objective: 10-2 110) Overhead cost is another term for fixed cost. Answer: TRUE Diff: 1Page Ref: 295 Skill: Concept Objective: 10-3 111) Cost-based pricing relies on consumer perception of value to drive pricing. Answer: FALSE Diff: 2Page Ref: 295 Skill: Concept Objective: 10-3 112) Average unit cost increases with accumulated production experience. Answer: FALSE Diff: 1Page Ref: 296 Skill: Concept Objective: 10-3 13) An upward-sloping experience curve is beneficial for a company. Answer: FALSE Diff: 3Page Ref: 297 Skill: Concept Objective: 10-3 114) The simplest pricing method is cost-plus pricing, which involves adding a standard markup to the cost of the product. Answer: TRUE Diff: 2Page Ref: 297 Skill: Concept Objective: 10-3 115) Markup pricing is popular because prices tend to be similar and p rice competition is thus minimized. Answer: TRUE Diff: 2Page Ref: 298 Skill: Concept Objective: 10-3 116) Target profit pricing is used when a firm tries to determine the price at which it will break even or make the profit it is seeking. Answer: TRUE Diff: 3Page Ref: 298 Skill: Concept Objective: 10-3 117) A break-even chart shows the total cost and total revenue expected at various sales volume levels. Answer: TRUE Diff: 2Page Ref: 298 Skill: Concept Objective: 10-3 118) Environmental elements are categorized as external factors that affect pricing decisions. Answer: TRUE Diff: 2Page Ref: 299 Skill: Concept Objective: 10-4 119) In a pure monopoly, the market consists of one seller. Answer: TRUE Diff: 1Page Ref: 303 Skill: Concept Objective: 10-4 120) Nonregulated monopolies always charge the full price because they do not fear attracting competition. Answer: FALSE Diff: 2Page Ref: 303 AACSB: Analytic Skills Skill: Application Objective: 10-4 121) Marketers may learn a few simple rules that apply equally to all price-demand relationships. Answer: FALSE Diff: 2Page Ref: 303 AACSB: Analytic Skills Skill: Application Objective: 10-4 122) The demand curve shows the number of units the market will buy in a given time period at different prices that might be charged. In normal cases, the higher the price, the lower the demand. Answer: TRUE Diff: 1Page Ref: 303 Skill: Concept Objective: 10-4 123) If demand changes greatly with price, we say the demand is inelastic. Answer: FALSE Diff: 2Page Ref: 304 Skill: Concept Objective: 10-4 124) The more elastic the demand, the more it pays for the seller to raise the price. Answer: FALSE Diff: 2Page Ref: 304 AACSB: Analytic Skills Skill: Application Objective: 10-4 125) Consumers will base their judgments of a products value on the prices that competitors charge for similar products. Answer: TRUE Diff: 2Page Ref: 304 Skill: Concept Objective: 10-4 126) Pricing and price competition account for the number-one problem facing many marketing executives. What are some of the frequent problems that companies encounter? Answer: The pricing environment changes at a fast pace, and value-seeking customers have put increased pricing pressure on many companies. However, companies are often too quick to reduce prices in order to get a sale rather than convincing buyers that their products are worth a higher price. A companys pricing, in addition, is often too cost-oriented rather than customer-value oriented. Companies have prices that are not revised often enough to reflect market changes. Another common problem is pricing that does not take the rest of the marketing mix into account. Diff: 2Page Ref: 289 AACSB: Analytic Skills Skill: Application Objective: 10-1 127) Discuss the importance of consumer perceptions of value and costs to setting prices. Answer: Customer perceptions of value set the upper limit for prices, and costs set the lower limit. However, in setting prices within these limits the company must then consider other internal and external factors. Internal factors affecting pricing include the companys overall marketing strategy, objectives, and marketing mix, as well as other organizational considerations. External factors include the nature of the market and demand, competitors strategies and prices, and other environmental factors. Diff: 1Page Ref: 291 AACSB: Analytic Skills Skill: Application Objective: 10-2 128) Explain how break-even analysis can be used for target profit pricing. Answer: The firm determines the price at which it will break even. The firm can also add the target profit to the fixed costs and then determine the new, break-even point, which now includes the target profit. Pricing decisions can be made by examining where the total revenue and total cost curves intersect on a break-even chart at different price points and sales volume. Diff: 2Page Ref: 298 AACSB: Analytic Skills Skill: Application Objective: 10-3 29) Identify and define the internal factors affecting a firms pricing decisions. Answer: The pricing strategy is largely determined by the companys target market and positioning objectives. Pricing decisions affect and are affected by product design, distribution, and promotion decisions. Costs set the floor for the companys price, which must cover all the costs of making and selling t he product, plus a fair rate of return. In order to coordinate pricing goals and decisions, management must decide who within the organization is responsible for setting price. Diff: 2Page Ref: 299 AACSB: Analytic Skills Skill: Application Objective: 10-4 130) Compare pure competition with oligopolistic competition. Answer: Under pure competition, the market consists of many buyers and sellers trading in a uniform commodity. No single buyer or seller has much effect on the going market price. Under oligopolistic competition, the market consists of few sellers who are highly sensitive to each others pricing and marketing strategies. The product can be uniform or nonuniform. There are few sellers because it is difficult for new sellers to enter the market. Each seller is alert to competitors strategies and moves. Diff: 3Page Ref: 302-303 AACSB: Analytic Skills Skill: Application Objective: 10-4 131) Compare oligopolistic competition with a pure monopoly. Answer: Under oligopolistic competition, the market consists of a few sellers who are highly sensitive to each others pricing and marketing strategies. There are few sellers because it is difficult for new sellers to enter the market. Under a pure monopoly, the market consists of one seller. Pricing is handled differently in each case. The seller may be a government monopoly, a private nonregulated monopoly, or a private regulated monopoly. Diff: 3Page Ref: 302-303 AACSB: Analytic Skills Skill: Application Objective: 10-4 32) Describe what a demand curve is and explain how it helps businesses. Answer: It estimates consumer demand at different prices. In a monopoly, the demand curve shows the total market demand resulting from different prices. If the company faces competition, its demand at different prices will depend on whether competitors prices stay constant or change with the companys own prices. Diff: 2Page Ref: 303 AACSB: Analytic Skills Skill: Application Objective: 10-4 133) What does price elasticity reveal about a product? Answer: Price elasticity is a measure of the sensitivity of demand to changes in price. If demand hardly changes with a small change in price, we say the demand is inelastic. If demand changes greatly, we say the demand is elastic. Diff: 1Page Ref: 304 AACSB: Analytic Skills Skill: Application Objective: 10-4 134) The company must consider the impact its prices will have on resellers. Identify three ways the company can help resellers. Answer: The company, first of all, should set prices that give resellers a fair profit. The company should also encourage their support. Finally, the company should help resellers to sell the product effectively. Diff: 1Page Ref: 305 AACSB: Analytic Skills Skill: Application Objective: 10-4 135) When setting prices, the company must consider its external environment. Describe four parts of the external environment and how they affect businesses. Answer: Economic conditions affect both the costs of producing a product and consumer perceptions of the products price and value. The company should encourage and support resellers and help them to sell the product effectively. The government, in the form of local, state, and federal laws, is another important influence on pricing decisions. Social concerns impact pricing, especially when a companys short-term sales, market share, and profit goals may have to be tempered by broader societal considerations. Diff: 1Page Ref: 305 AACSB: Analytic Skills Skill: Application Objective: 10-4 136) How important is price among the elements of the marketing mix? Answer: In recent decades, nonprice factors have gained increasing importance. However, price still remains one of the most important elements determining a firms market share and profitability. Diff: 2Page Ref: 290 AACSB: Analytic Skills Skill: Application Objective: 10-1 37) Why is price considered to be one of the most flexible elements of the marketing mix? Answer: Price can be changed quickly. Diff: 1Page Ref: 290 AACSB: Analytic Skills Skill: Application Objective: 10-1 138) Explain the concept of a price floor. Answer: A price floor is the lowest price charged at which the company still earns some profits. Diff: 2Page Ref: 291 AACSB: Analytic Skills Skill: Applicatio n Objective: 10-2 139) Explain the concept of a price ceiling. Answer: A price ceiling is the highest price charged at which there is still some consumer demand. Diff: 2Page Ref: 291 AACSB: Analytic Skills Skill: Application Objective: 10-2 140) What must a company using value-based pricing find out about its customers? Answer: They must determine the specific value that individual buyers assign to different competitive offers. Diff: 3Page Ref: 292 AACSB: Analytic Skills Skill: Application Objective: 10-2 141) Explain good-value pricing. Answer: With good-value pricing, a marketer offers just the right combination of quality and good service at a fair price. Diff: 1Page Ref: 293 AACSB: Analytic Skills Skill: Application Objective: 10-2 142) What must a firm do to retain pricing power? Answer: To retain pricing power, a firm must retain of build the value of its market offering. Diff: 2Page Ref: 293 AACSB: Analytic Skills Skill: Application Objective: 10-2 143) What costs make up a products total cost? Answer: Fixed costs and variable costs make up total cost. Diff: 1Page Ref: 296 AACSB: Analytic Skills Skill: Application Objective: 10-3 144) Explain the significance of a downward-sloping experience curve. Answer: Not only will the companys unit production cost fall, but it will fall faster if the company makes and sells more during a given time period. Diff: 3Page Ref: 297 AACSB: Analytic Skills Skill: Application Objective: 10-3 145) A marketers fixed costs are $400,000, the variable cost is $16, and they expect the product to sell for $24. What is their break-even point in units? Answer: The break-even point in units is 50,000 units. Diff: 3Page Ref: 298 AACSB: Analytic Skills Skill: Application Objective: 10-3 146) A marketers fixed costs are $400,000, the variable cost is $16, and they expect the product to sell for $24. What is their break-even point in dollar sales? Answer: The break-even point in dollar sales is $1,200,000. Diff: 3Page Ref: 298 AACSB: Analytic Skills Skill: Application Objective: 10-3 147) A marketers fixed costs are $400,000, the variable cost is $16, and they expect their product to sell for $24. If the marketer has sales of $1,440,000, what is their profit on this product? Answer: The profit is $80,000. Diff: 3Page Ref: 298 AACSB: Analytic Skills Skill: Application Objective: 10-3 148) Who typically sets prices in small companies? In large companies? Answer: Top management sets prices in small companies, whereas divisional or product line managers typically set prices in large companies. Diff: 2Page Ref: 300 AACSB: Analytic Skills Skill: Application Objective: 10-4 149) Explain a pure monopoly. Answer: The market consists of one seller that dominates the market. Diff: 2Page Ref: 303 AACSB: Analytic Skills Skill: Application Objective: 10-4 150) If demand is elastic, will sellers consider lowering their prices? Explain. Answer: Yes. A lower price will produce more needed revenue, as consumers will respond to the change in price and buy more. Diff: 2Page Ref: 304 AACSB: Analytic Skills Skill: Application Objective: 10-4