A technology attorney claims that while Amazon has done a lot of good for the industry, it is engaging in aggressive pricing strategies. According to him, Amazon purchases books for one price and then sells them for much cheaper. For instance, it allegedly purchases a book for $13 and sells it for $9. Because of its power and scale, Amazon can currently get away with this. The lawyer believes Amazon will drive prices down so low that rivals cannot compete, and it will gain up to 90 percent market share. Authors will then have to sell their books at knock-down prices because they have nowhere else to go. The technology attorney is accusing Amazon of _____________.

counterfeit pricing

price discrimination

deceptive pricing

price fixing

predatory pricing

Answer: predatory pricing

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Marketing Chapter 19

ACME Corp. offers a price discount to encourage prompt payment. Which of the following is it likely to use?
Which of the following charges the same price to all customers regardless of geographic location, and the price is based on average shipping costs for all customers?
Which of the following pass on to a business customer the cost savings gained through economies of scale?
The Federal Trade Commission is investigating ACME Corp. for using misleading price tags at its outlet stores to deceive customers into believing they are getting a bargain on Wile E. branded items. Which of the following does the FTC believe ACME is guilty of?
Maria is concerned about both price and quality of a product. Marketers would best describe her as which of the following?
A price developed in the buyer's mind through experience with the product is a(n) _____.
Which of the following is the point at which the costs of producing a product equals the revenue made from selling the product?
Which of the following is calculated by dividing the variable costs by the number of units produced?
A business's rental of production space is an example of a _____.
Spacely Inc.'s sprockets have inelastic demand. If Spacely raises the price of sprockets, what will be the result?
ACME Corp.'s widgets have elastic demand. If ACME raises the price of widgets, what will be the result?
Which of the following shows the quantity of products a firm expects to sell at various prices if other factors remain constant?
Which of the following is a major advantage of nonprice competition?
ACME Corp. and Spacely Inc. are engaged in intense price competition in order to boost market share of their widgets. This is best described as _____.
To compete effectively on a price basis, a firm should ____.
Which of the following is NOT one of the factors that influence the assessment of value?
Price is a key element in the marketing mix because it relates directly to the generation of total _____.
Which of the following statements about the international use of the Internet is true?
Cartoon Network encountered problems introducing the cable channel to Scandinavian television because of opposition to the violent nature of some cartoons like those with the Road Runner and Tom and Jerry. Turner could have used _____ to counter negative publicity and communicate the company's commitment to non-violence.
_____ is the promotional function that deals with problems involving local governments, media, trade associations and the general public.
In 2006, the Harvard faculty pressured President Lawrence Summers into resigning. Some alumni were upset by this incident. Harvard will most likely use _____ to soothe alumni feelings.
Which of the following statements about the use of sales promotion tools in international markets is true?
In many countries, sales promotion faces problems with distribution and retailers' resistance to processing coupons, setting up displays and dealing with premiums. These are sales promotion difficulties associated with:
Which of the following statements about international sales promotions is true?
Which of the following statements about the use of advertising and sales promotion in international markets is true?

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Jennifer Sloan was recently hired by IBM as a solutions sales representative upon graduation from college and after working with the company for two years, now earns a base salary of $90,000 as well as commissions on sales and bonuses for exceeding her quarterly sales quotas. Jennifer is a fashionista and enjoys purchasing the latest styles and fashions from high-end designers such as Chanel, Dolce Gabbana, and her favorite red-soled shoes from Christian Louboutin that cost $500 or more per pair. Jennifer realizes that comparable products from other brands are priced much lower but enjoys the added luxury of these designer labels and feels that the quality is much better. In addition, Jennifer meets regularly with senior executives including vice presidents and presidents of companies and believes her image is related to her success as a sales representative. What type of pricing strategy do Christian Louboutin, Chanel, and Dolce Gabbana most likely utilize?
___ pricing is often employed by marketers such as cell phone companies including Verizon and AT&T who attempt to influence a customer's perception of price to make a product's price more attractive or evoke a customer's emotions in the purchase decision.
Airlines will often change prices depending upon day of the week, time of day, and number of days before the flight. It is quite common that a person sitting next to you on a flight paid a much different price than you did. What type of pricing strategy are the airlines most likely using?
Canon has several lines of digital cameras and often markets its Rebel DSLR camera body with a basic lens at an affordable price of $399. However, consumers who desire additional lenses might pay $400 or more for each additional lens. What type of pricing is Canon utilizing for its Rebel product line?
AMC Theaters has recently noticed a decline in movie theater attendance due to consumers' shifting media habits, such as streaming movies via Netflix, Hulu, and Amazon Prime. The theater chain is setting prices low to attract more sales and motivate consumers to return to the cinema for newly released movies. What type of pricing objective is AMC Theaters utilizing?
Blue Ribbon Farms is a family-owned farm and sells its seasonal produce, meat, eggs, and bakery items at several farmers' markets within a 60-mile radius of the farm. The owners utilize a Square payment system for credit cards, which is conveniently attached to a digital device such as an iPhone or iPad; however, the farm is charged a credit card fee of 8% of the retail price to process each credit card transaction. In order to encourage shoppers to pay with cash, Blue Ribbon Farms offers a 10% discount on purchases for consumers who pay by cash or check. Blue Ribbon Farms is utilizing a _____ pricing strategy.

Marketing MCQ

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