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Exam 14: Small Business Marketing: Price and Promotion

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Question 71

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Jewelry, perfume, beer, and law firm services all use prestige pricing as a pricing strategy.

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Question 72

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To measure the effectiveness of advertising, companies may choose to code two different ads to see which produces a greater response, a technique that is referred to as split advertising.

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Question 73

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Setting the price of a product in a way that will alter its perception to customers is known as

Creating goodwill rather than making immediate sales is known as

People purchase premium products despite the higher costs because

Explain the three primary considerations in setting the price for a product.

Sales commissions, materials, and labor tend to be fixed costs.

The "right" price, as determined by the small business owner, is a range between what the market will bear and what the product

Home electronics are often introduced using a skimming pricing strategy.

In the Creating Competitive Advantage box titled "Guppy in a Shark Tank," which of the following is not one of the suggestions for making trade shows successful for small businesses?

At Marco's Men's Store, all ties are priced at one of three different price points: $16.95, $24.95, and $33.95. This is an example of what type of pricing tactic?

Open charge accounts can hinder the cash flow of a business and eventually cause the business to fail.

When considering a product, consumers typically look for the cheapest product available.

When used with advertising and personal selling, __________ can give a short-term boost to sales.

The value of a product depends on the benefits received compared to the ________.

__________ is any activity that stimulates sales and is not strictly advertising or personal selling.

Using coded or dated coupons can let the researcher compare different media. This is known as

Costs like rent, property taxes, and utilities are generally

Products for which customers are price sensitive are said to be

Use the following to answer questions: Scenario 14-2. Benjamin has been running his kennel service for one year. So far, business has been good and all expenses have been met each month, leaving a small profit. He has a large building capable of handling a total of 35 dogs. Each pen has fresh water supplied through pipes, an automated feeder, and a heating/cooling unit that keeps each pen at a comfortable 68 degrees. Benjamin rents each pen at a price of $30 per day. His total fixed costs each month are $500. Average variable costs are $12. -In Scenario 14-2 above, if Benjamin's fixed costs were to rise to $600 per month while all other variables remained the same, what would Benjamin's new breakeven point be?