Question 1

Which of the following statements on markdowns is False?

Accepted Answer

A)   Markdowns are an unnecessary part of business if planned correctly.
B)   Markdowns are an opportunity to increase sales.
C)   Promotional markdowns increase customer flow.
D)   If markdowns are too low, the buyer may be not purchasing enough merchandise.
E)   If markdowns are too low, the buyer may be pricing their merchandise too low.F) A) and B)
G) A) and C)

Question 2

What are the strengths of operating with a high/low pricing strategy?

Accepted Answer

The high/low pricing strategy ...

Question 3

Retailers using a(n)  ________ strategy frequently-often weekly-discount the initial prices for merchandise through sales promotions.

Accepted Answer

A)   disintermediated pricing
B)   penetration pricing
C)   high/low pricing
D)   price skimming
E)   everyday low-pricingF) C) and D)
G) A) and B)

Question 4

Periodic price audits are completed at retail stores to ensure that the

Accepted Answer

A)   prices are high enough to cover costs.
B)   prices are lower than the competition.
C)   extent and cause of scanning errors are identified.
D)   product is priced consistent with the company's pricing policy.
E)   retailer is not engaging in horizontal price fixing.F) C) and D)
G) A) and D)

Question 5

How are retailers affected by scanning errors? What are the measures taken to minimize these errors?

Accepted Answer

In general, retailers lose money from sc...

Question 6

________ refers to charging different prices for different stores, markets, or regions.

Accepted Answer

A)   Zone pricing
B)   Geofencing
C)   Price lining
D)   Price optimization
E)   Odd pricingF) A) and E)
G) C) and E)

Question 7

Which of the following is an example of a variable cost for a retailer of electronic equipment?

Accepted Answer

A)   The display tables for mounting the computer, monitor, and printer
B)   The cost associated with the free pack of paper for every computer printer sold
C)   The store rent charged by the mall
D)   The cost of obtaining the licenses required by the local government
E)   The cost of manufacturing the electronic equipmentF) C) and D)
G) A) and D)

Question 8

A travel brochure shows that a couple can buy a round trip ticket to Orlando, a three-day pass to Disney World, car rental for four days, and hotel accommodations for 5 nights for $1200 per person. These services are more expensive when availed individually. This offer is an example of

Accepted Answer

A)   price lining.
B)   psychological pricing.
C)   bait and switch bundling.
D)   price bundling.
E)   conjoint pricing.F) A) and B)
G) A) and C)

Question 9

Which of the following factors influences reductions?

Accepted Answer

A)   The cost of alterations
B)   The amount subtracted from the gross margin
C)   Theft and accounting errors
D)   Tax write-off for corporate volunteer hours
E)   Format of saving for low profit quartersF) B) and E)
G) A) and D)

Question 10

Buyers generally do not plan for markdowns.

Accepted Answer

A) True 
 B)False

Question 11

Retailers collect price data about their competitors to

Accepted Answer

A)   see if they need to adjust their prices.
B)   match supply and demand.
C)   maximize their sales and profits by means of yield management.
D)   assess the quality of services provided.
E)   determine service quality.F) A) and E)
G) A) and B)

Question 12

Which of the following statements is a limitation of the rule-based approach to taking markdowns?

Accepted Answer

A)   The rule-based approach is based upon gross margin.
B)   The approach prohibits input from the vendor.
C)   The approach does not follow a fixed schedule.
D)   It does not consider the demand for merchandise at different price points.
E)   The approach assumes that items in a category do not exhibit the same behavior.F) D) and E)
G) B) and C)

Question 13

A bookstore is considering stocking a limited edition of Alice in Wonderland dolls at a cost of $125 each. The manager calculated the retail price with an initial markup percentage of 48 percent and plans to ticket the product with a ".00" ending. What would be the initial retail price on the doll?

Accepted Answer

A)   $180
B)   $190
C)   $240
D)   $280
E)   $63F) C) and D)
G) A) and B)

Question 14

The retail price of a sweater is $75, and the initial markup is 51 percent. Calculate the cost of the product.

Accepted Answer

A)   $33.75
B)   $25.71
C)   $28.50
D)   $36.75
E)   $42.85F) B) and C)
G) B) and E)

Question 15

How can a retailer that wants to use an EDLP strategy persuade customers away from high/low strategy competitors?

Accepted Answer

A)   By using price lining
B)   By using a demand-oriented method for setting retail prices
C)   By assuring customers of low prices
D)   By refusing to accept manufacturers' coupons
E)   By increasing advertisingF) C) and D)
G) A) and E)

Question 16

Which of the following is set by vendors by withholding benefits such as cooperative advertising or even refusing to deliver merchandise to noncomplying retailers?

Accepted Answer

A)   Predatory pricing
B)   Horizontal pricing
C)   Bait and switch
D)   Vertical pricing
E)   MSRP pricingF) D) and E)
G) B) and E)

Question 17

Which of the following statements is not True of markdowns?

Accepted Answer

A)   Markdowns are part of the cost of doing business, and thus buyers plan for them.
B)   A buyer's objective is to minimize markdowns.
C)   Retailers have a set of arbitrary rules for taking markdowns.
D)   Buyers employ markdowns to promote merchandise and increase sales.
E)   Markdowns can increase customer traffic flow.F) A) and B)
G) A) and E)

Question 18

What is the potential byproduct of promotional markdowns?

Accepted Answer

A)   It is a way of achieving a break-even point.
B)   Promotional markdowns benefit customers because they are charged according to their willingness to pay.
C)   Retailers aim to get rid of unwanted merchandise through promotional markdowns.
D)   The increased in-store traffic can lead to the purchase of other products at regular prices.
E)   Buyers are benefitted because they are charged according to the market segment to which they belong.F) C) and D)
G) A) and B)

Question 19

Cliff is struggling with the price of produce at his well-established produce markets. The reputation of the markets attracts repeat customers from a 50-mile radius. Recently, local farmers started increasing produce prices for him due to the upsurge in gas prices. Now, Cliff feels it is time to pass the costs onto his customers. Which of the following should Cliff estimate to determine the effect of price changes?

Accepted Answer

A)   Price elasticity
B)   Break-even point quantity
C)   Fixed costs
D)   Reference price
E)   Markup percentageF) A) and B)
G) A) and E)

Question 20

Which of the following is an example of a fixed cost for a bridal gown shop?

Accepted Answer

A)   The services of the seamstress to fit each gown
B)   The cost associated with dying the shoes to match the bridesmaids' dresses
C)   The cost associated with the layaway of variously priced gowns
D)   The cost of the mannequin used to display current gowns
E)   The cost associated with a generous return policyF) A) and D)
G) A) and C)

Exam 13: Retail Pricing

Which of the following statements is not True of markdowns?

Correct Answer
verified

Which of the following statements is a limitation of the rule-based approach to taking markdowns?

Correct Answer
verified

________ refers to charging different prices for different stores, markets, or regions.

Correct Answer
verified

Which of the following statements on markdowns is False?

Correct Answer
verified

Retailers collect price data about their competitors to

Correct Answer
verified

Retailers using a(n) ________ strategy frequently-often weekly-discount the initial prices for merchandise through sales promotions.

Correct Answer
verified

Which of the following is an example of a fixed cost for a bridal gown shop?

Correct Answer
verified

Buyers generally do not plan for markdowns.

Correct Answer
verified

How can a retailer that wants to use an EDLP strategy persuade customers away from high/low strategy competitors?

Correct Answer
verified

Which of the following is set by vendors by withholding benefits such as cooperative advertising or even refusing to deliver merchandise to noncomplying retailers?

Correct Answer
verified

A travel brochure shows that a couple can buy a round trip ticket to Orlando, a three-day pass to Disney World, car rental for four days, and hotel accommodations for 5 nights for $1200 per person. These services are more expensive when availed individually. This offer is an example of

Correct Answer
verified

The retail price of a sweater is $75, and the initial markup is 51 percent. Calculate the cost of the product.

Correct Answer
verified

What are the strengths of operating with a high/low pricing strategy?

Correct Answer
verified
The high/low pricing strategy ...
View Answer

Which of the following factors influences reductions?

Correct Answer
verified

What is the potential byproduct of promotional markdowns?

Correct Answer
verified

How are retailers affected by scanning errors? What are the measures taken to minimize these errors?

Correct Answer
verified
In general, retailers lose money from sc...
View Answer

Which of the following is an example of a variable cost for a retailer of electronic equipment?

Correct Answer
verified

Correct Answer
verified

Periodic price audits are completed at retail stores to ensure that the

Correct Answer
verified

A bookstore is considering stocking a limited edition of Alice in Wonderland dolls at a cost of $125 each. The manager calculated the retail price with an initial markup percentage of 48 percent and plans to ticket the product with a ".00" ending. What would be the initial retail price on the doll?

Correct Answer
verified

Exam 13: Retail Pricing

Which of the following statements is not True of markdowns?

Correct AnswerverifiedShow Answer

Which of the following statements is a limitation of the rule-based approach to taking markdowns?

Correct AnswerverifiedShow Answer

________ refers to charging different prices for different stores, markets, or regions.

Correct AnswerverifiedShow Answer

Which of the following statements on markdowns is False?

Correct AnswerverifiedShow Answer

Retailers collect price data about their competitors to

Correct AnswerverifiedShow Answer

Retailers using a(n) ________ strategy frequently-often weekly-discount the initial prices for merchandise through sales promotions.

Correct AnswerverifiedShow Answer

Which of the following is an example of a fixed cost for a bridal gown shop?

Correct AnswerverifiedShow Answer

Buyers generally do not plan for markdowns.

Correct AnswerverifiedShow Answer

How can a retailer that wants to use an EDLP strategy persuade customers away from high/low strategy competitors?

Correct AnswerverifiedShow Answer

Which of the following is set by vendors by withholding benefits such as cooperative advertising or even refusing to deliver merchandise to noncomplying retailers?

Correct AnswerverifiedShow Answer

A travel brochure shows that a couple can buy a round trip ticket to Orlando, a three-day pass to Disney World, car rental for four days, and hotel accommodations for 5 nights for $1200 per person. These services are more expensive when availed individually. This offer is an example of

Correct AnswerverifiedShow Answer

The retail price of a sweater is $75, and the initial markup is 51 percent. Calculate the cost of the product.

Correct AnswerverifiedShow Answer

What are the strengths of operating with a high/low pricing strategy?

Correct AnswerverifiedThe high/low pricing strategy ...View AnswerShow Answer

Which of the following factors influences reductions?

Correct AnswerverifiedShow Answer

What is the potential byproduct of promotional markdowns?

Correct AnswerverifiedShow Answer

How are retailers affected by scanning errors? What are the measures taken to minimize these errors?

Correct AnswerverifiedIn general, retailers lose money from sc...View AnswerShow Answer

Which of the following is an example of a variable cost for a retailer of electronic equipment?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Periodic price audits are completed at retail stores to ensure that the

Correct AnswerverifiedShow Answer

A bookstore is considering stocking a limited edition of Alice in Wonderland dolls at a cost of $125 each. The manager calculated the retail price with an initial markup percentage of 48 percent and plans to ticket the product with a ".00" ending. What would be the initial retail price on the doll?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The high/low pricing strategy ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
In general, retailers lose money from sc...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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