#1
What is the primary goal of a penetration pricing strategy?
To gain market share quickly
ExplanationCapture a large customer base rapidly by offering low initial prices.
#2
Which pricing tactic involves offering two or more products together at a reduced price compared to purchasing them separately?
Price bundling
ExplanationCombine products to provide a discount when purchased together.
#3
Which pricing strategy aims to set prices based on the total production cost plus a markup?
Cost-plus pricing
ExplanationCalculate prices by adding production cost and desired profit margin.
#4
What is the main advantage of using a price bundling strategy?
It attracts price-sensitive customers
ExplanationAttract customers looking for discounted deals by bundling products.
#5
What is the primary focus of a cost-based pricing strategy?
Covering production and overhead costs
ExplanationDetermine prices to ensure all production and overhead costs are covered.
#6
Which pricing strategy involves setting prices based on the perceived value to the customer?
Value-based pricing
ExplanationDetermine prices by the customer's perception of product value.
#7
What is the main disadvantage of using a price skimming strategy?
It may attract competitors quickly
ExplanationRisk of inviting competitors due to high initial prices and potential high profits.
#8
Which pricing tactic involves setting a low initial price to capture market share quickly?
Penetration pricing
ExplanationInitiate with low prices to quickly secure a significant market share.
#9
Which of the following is a characteristic of a price leadership strategy?
Setting prices based on competitor's prices
ExplanationEstablish prices by closely monitoring and mirroring competitor prices.
#10
What is the objective of value-based pricing?
To capture the perceived value from customers
ExplanationCapture the value that customers attribute to the product.
#11
What is the purpose of dynamic pricing?
To adjust prices based on supply and demand fluctuations
ExplanationModify prices in response to changes in market supply and demand.
#12
In the context of pricing strategies, what does 'price elasticity of demand' measure?
The sensitivity of consumer demand to changes in price
ExplanationAssesses how consumer demand reacts to price changes.
#13
Which pricing strategy is most suitable for products with high perceived value and low production costs?
Skimming pricing
ExplanationSet high initial prices for products with perceived high value and low production costs.