1. Quick Quiz
3.04

2. What costs do businesses usually include in the price of their products?
1-Regulations 2-Inflation 3-Transportation 4-Orientation

3. What would be the most appropriate pricing strategy for a business in a small town where unemployment has skyrocketed and the economy is in a downturn?
1-Below-cost pricing 2-High-level pricing 3-Odd-cents pricing 4-Flexible pricing

4. What pricing tactic might be considered questionable by some businesses?
1-Matching the prices of a competitor 2-Developing a complex pricing structure 3-Marking up prices to earn a profit 4-Providing a reference price

5. What is an example of an unethical pricing practice?
1-A company prices its products low in an attempt to drive its competitors out of business. 2-A business increases its prices when the cost of the materials to make the products increases. 3-A firm sets a business objective to increase its profit margins over the next five years. 4-A business prices a new product line to reflect high quality and status.

6. What is the advantage to a business of using bar-code pricing?
1-Easier for customers to read 2-Reduces required business security 3-Easier to change prices 4-Reduces number of employees needed for sales

7. How does technology help businesses when it enables them to obtain and analyze vast amounts of information that impact the pricing function?
1-By generating profit-and-loss statements 2-By deciding how much to spend on advertising 3-By calculating the cost of hiring more employees 4-By determining the best time to adjust prices

8. A business charges a small company a higher price for a product than it charges a large company for the same product.  What does this represent?
1-Price discrimination 2-Controlled pricing 3-Price competition 4-Regulated pricing

9. 1-Bait-and-switch 2-Price fixing 3-Loss-leader pricing 4-Gray markets
Companies A, B, and C sell similar products.  Together, they recently decided to sell their products for the same price.  In what unethical activity are the businesses engaging?
1-Bait-and-switch 2-Price fixing 3-Loss-leader pricing 4-Gray markets

10. What is an external factor that affects the price that a business charges for its products?
1-Operating costs 2-Variable expenses 3-Economic conditions 4-Employee benefits

11. Why do some new companies set their selling prices as low as they can?
1-To eliminate all possible competition 2-To get market share as fast as possible 3-To earn a high return on investment 4-To quickly make a large profit