American Girl Doll: The American Girl catalog began as a concept to introduce today's girls to those who lived in the past. Each historically accurate doll is carefully crafted and dressed and has books to describe her life. For example, Kristen is an 1854 pioneer girl who is growing up in Minnesota.
Her story begins with her long sea voyage from Sweden. The basic doll, dressed in a calico dress and striped apron plus the hardcover story of how she got to Minnesota, costs $90.00. Six more hardback books of Kristen's life are available for $74.95. Kristen's nightgown costs $20.00, and a matching one for the doll owner is an additional $38.00. Buy both together and the price is only $50.00. A hand- painted wooden bed and trunk for Kristen are available for $213.00. Shipping costs vary with the price of the merchandise ordered.
- Refer to American Girl Doll. American Girl is the primary seller of historically accurate dolls with accompanying books in a market where there is very little competition. It has no cash flow problems and is not interested in maximizing its sales. From this information, you should know American Girl has ___ pricing objectives.
a. status quo
b. psychological
c. profit-oriented
d. sales-oriented
e. supply-derived
ANSWER: c
- Refer to American Girl Doll. The popularity of the American Girl dolls is so great that an increase in the price of the basic Kristen doll and books by 5 percent will not significantly affect the demand for the product. The means that the demand for the American Girl doll is:
a. elastic.
b. derived.
c. a multiplier.
d. inelastic.
e. symmetrical.
ANSWER: d
- Refer to American Girl Doll. Based on the information in the narrative, which of the following factors is most likely to affect the elasticity of demand for the doll?
a. The absence of substitutes
b. The existence of complementary products
c. The price relative to purchasing power
d. Product durability
e. A variety of alternative uses for the product
ANSWER: a
- Refer to American Girl Doll. In terms of the costs of producing the doll and its accessories, the salary of the graphic designer who does the layout for the American Girl catalog is a(n):
a. markup cost.
b. variable cost.
c. fixed cost.
d. derived cost.
e. elastic cost.
ANSWER: c
- Refer to American Girl Doll. In terms of producing the doll and its accessories, the calico fabric used to make Kristen's dress is an example of a(n):
a. markup cost.
b. variable cost.
c. fixed cost.
d. derived cost.
e. elastic cost.
ANSWER: b
- Refer to American Girl Doll. You can buy a doll at Walmart for $5.99. The high price of the American Girl doll is used to promote a high-quality image. American Girl uses a ___ pricing strategy.
a. markup
b. demand-based
c. prestige
d. penetration
e. supply-derived
ANSWER: c
Learn More :
Marketing Chapter 20
- If an online retailer lists shipping charges according to the dollar amount of merchandise purchased, you know that it is using _____ pricing.
- A(n) _____ discount is a deduction from list prices that applies to the buyer's total purchases made during a specific period and is intended to encourage customer loyalty.
- Home Depot's fall lawn mower sale is an example of which of the following pricing tactics?
- Which type of discount is a price reduction offered to a consumer, an industrial user, or a marketing intermediary in return for prompt payment of a bill?
- "The unregulated financial derivatives market created a shadow banking system that performed some of the same functions as the real banking systemlong dash—but without the checks and balances that keep a banking system from spinning out of control." Which of the following lessons BEST supports this comment?
- What will the Dodddash-Frank bill do to ensure transparency in markets, hedge funds, and other financial products?
- What is the goal of the Volcker Rule in Dodddash-Frank?
- What is the task of the Bureau of Consumer Financial Protection within the Federal Reserve?
- Which of the following was created to monitor systemic risks that might affect a significant portion of the economy?
- _____ was established in 2010 in order to restructure and improve the finance industry by better monitoring systematic risk, safeguarding consumers, and more effectively examining market fluctuations.
- In 2006, David had a very low credit score, insufficient income, and no collateral to offer for a loan. Yet, when he applied, he was approved by YourMoney Bank for a loan to buy a house. Which of the following describes this loan?
- When demand drives prices of an asset far beyond its intrinsic economic value, what has been created?
- All The Best Financial recently developed an investment product where different types of debts, such as mortgages, are assembled together. All The Best's investment product exemplifies which of the following?
- Adding to the housing bubble, lenders increased which of the following to determine how much of a loan a borrower could receive based on the home's value?
- A ________ is an extreme deficiency of assets within an area of the economy during which businesses are not able to obtain enough funding to meet their operating requirements.
- A(n) ______ offers variable interest rates mortgages to consumers by creating attractive introductory rates which later rise dramatically.
- Which of the following is the best type of institution to use to set up a scholarship fund or other type of philanthropic giving?
- Which of the following are also called savings and loan associations?
- NFP Financial is a not-for-profit, member-owned cooperative that offers deposit accounts and lending services to customers and small businesses. Which of the following best describes NFP?
- Which of the following established the Federal Deposit Insurance Corporation?
- Which of the following help lenders review the solvency of borrowers?
- ______ deal primarily with providing financial services to corporations in international matters.
- DidItMyself Tools is interested in entering the Chinese market for selling its products. Which type of bank would be most helpful to DidItMyself as it embarks on its first international operation?
- ABC Toys is interested in acquiring World Toys, both of which are located in the United States. Which type of bank should ABC use for help with this acquisition?
- Which of the following offer a full menu of client services with an international reach?