#1
Which of the following is NOT a factor affecting pricing decisions?
Costs
Competition
Consumer preferences
Currency exchange rates
#2
What pricing strategy involves setting a low initial price for a new product to penetrate the market quickly?
Skimming pricing
Penetration pricing
Premium pricing
Psychological pricing
#3
What is the key assumption behind the law of demand?
Consumers have perfect information
There are no substitutes available for the product
Consumers will buy more of a good when its price decreases
Income levels remain constant
#4
Which of the following is a characteristic of monopolistic competition?
Many firms selling identical products
A single firm dominates the market
High barriers to entry
Product differentiation
#5
Which pricing strategy involves setting prices just below a whole number, such as $4.99 instead of $5.00?
Odd-even pricing
Cost-plus pricing
Premium pricing
Psychological pricing
#6
Which economic concept describes the point at which supply and demand in a market are equal?
Elasticity
Equilibrium
Monopoly
Marginal utility
#7
In which market structure do firms have the least control over pricing?
Monopoly
Oligopoly
Monopolistic competition
Perfect competition
#8
What is the primary goal of value-based pricing?
Maximizing profits
Matching competitors' prices
Aligning prices with production costs
Capturing the perceived value of a product
#9
Which pricing strategy involves setting prices slightly below whole-number amounts?
Odd-even pricing
Cost-plus pricing
Bundle pricing
Target pricing
#10
What does the term 'price floor' refer to in economics?
A legally mandated minimum price for a good or service
A pricing strategy used to maximize profits
A ceiling on the maximum price that can be charged for a good or service
The equilibrium price determined by market forces
#11
Which of the following is NOT a potential outcome of price discrimination?
Increased consumer surplus
Decreased producer surplus
Increased total revenue
Reduced market segmentation
#12
What does the price elasticity of demand measure?
The percentage change in quantity demanded relative to a percentage change in price
The absolute change in quantity demanded relative to an absolute change in price
The percentage change in price relative to a percentage change in quantity demanded
The absolute change in price relative to an absolute change in quantity demanded
#13
Which of the following is NOT a characteristic of perfectly competitive markets?
Homogeneous products
Ease of entry and exit
Price-setting power for individual firms
Perfect information
#14
What is the term used to describe the situation when a firm can increase output without experiencing an increase in average costs?
Economies of scale
Diseconomies of scale
Constant returns to scale
Increasing returns to scale
#15
In a monopolistic competition market structure, firms have some control over pricing due to:
Barriers to entry
Product differentiation
Perfect information
Homogeneous products