Question

Create multiple-choice test questions for each content and academic vocabulary term.

Content Vocabulary

  • markup (p. 605\bf{605})
  • one-price policy (p. 608\bf{608})
  • flexible-price policy (p. 608\bf{608})
  • skimming pricing (p. 609\bf{609})
  • penetration pricing (p. 610\bf{610})
  • product mix pricing strategies (p. 613\bf{613})
  • price lining (p. 613\bf{613})
  • bundle pricing (p. 613\bf{613})
  • geographical pricing (p. 614\bf{614})
  • segmented pricing strategy (p. 614\bf{614})
  • psychological pricing (p. 615\bf{615})
  • prestige pricing (p. 616\bf{616})
  • everyday low prices (EDLP) (p. 616\bf{616})
  • promotional pricing (p. 616\bf{616})

Academic Vocabulary

  • relation (p. 605\bf{605})
  • allocated (p. 606\bf{606}
  • ultimate (p. 618\bf{618})
  • vehicles (p. 618\bf{618})

Solution

Verified

Content Vocabulary-

Markup- The difference between the actual cost of the item and the sale price of the item. Products may be "marked up" by several parties before reaching the final consumer.

One-price policy- Every customer is charged the same price. There are no deviations from this price, it is the most consistent way to price one product.

Flexible-price policy- Customers pay a variety of different prices for the same product. This is typically where bargaining comes in, when you are purchasing a car, artwork or some types of jewelry.

Skimming pricing- When an astronomically high price is set on a new product. Typically this method is used when demand is measurably high. This is used during the introductory period of a new product.

Penetration pricing- The complete opposite of skimming, where the price for a new product is set quite low. This method is used when a business wants to encourage as many customers as possible to purchase their new product.

Product mix pricing strategies- When a group of products gets a price adjustment instead of just one product, in an effort to maximize profitability.

Price lining- A limited number of prices is set for specific groups of merchandise.

Bundle pricing- A single price is offered for a package of products that have been clumped together by a retailer. The price for all the products combined is less than buying each of the products individually.

Geographical pricing- Price adjustments that are necessary based on what the different shipping agreements are.

Segmented pricing strategy- Two or more prices for a single product are used, even though there is absolutely zero difference in the item's cost.

Psychological pricing- These techniques create a type of illusion for the customers, typically these involve changing the price just a few cents to look more appealing for the consumer.

Prestige pricing- Prices are set high in order to signify that the product is of a higher quality and suggests that the consumer has some sort of high status.

Everyday low prices- Consistently low set prices that will most likely not increase. They offer a stable benefit for consumers as well as the retailer.

Promotional pricing- Used when a retailer is doing some sort of promotion, prices will be set quite low for the promotion and it is typically for a short period of time.

Academic Vocabulary-

Relation- This describes the connection that demand and price have within a given pricing method.

Allocated- The amount of money that needs to be put towards an expense.

Ultimate- Final or last decision that is made related to pricing.

Vehicle- An instrument for companies to explain certain complex ideas to consumers, like pricing information.

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