Practical Management Science
6th Edition
ISBN: 9781337406659
Author: WINSTON, Wayne L.
Publisher: Cengage,
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Chapter 8.4, Problem 4P
Summary Introduction
To determine: The optimal pricing policy.
Introduction: The variation between the present value of the
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7 Howe, Dewey, Cheatem (HDC) produces parts for airplanes. HDC has two pricing schemes: 1) fixed price (not directly driven by costs) and 2) cost plus (costs plus fixed fee). All parts fabricated by HDC are bespoke to the customer. HDC determines on which basis to charge the customer based on which will provide the highest profit. Is it ethical to choose a price scheme based on which will produce the higher income? Why?
Sherri told Liz that her firm will compete on setting prices because that's good business. Which statement best
explains her position?
a Sherri is talking about skimming.
b) Sherri wants her company to have a loss-leader pricing strategy.
)Sherri is talking about EDLP, or sustained discount pricing. If it works for Walmart and Costco, it can work
for her.
d) Sherri needs to learn that the goal of pricing strategy is to match the competition by any means necessary,
and compete on other factors.
The airline industry alters the price of its seats based on the type of seat, the number of seats remaining, and the amount of time before the flight departs. This is example of:
Select one:
a. Basing-point pricing
b. Zone pricing
c. Dynamic pricing
d. FOB-origin pricing
Which of the following statements is correct?
Select one:
a. If the prices of the product are below its costs, profits will boost.
b. The pricing strategy suggesting value to the customer and profit to company should be followed.
c. If customers perceive that the product is over-priced, they are keener to buy it.
d. If customers perceive that a product’s price is lower than its value, they will not buy it.
Chapter 8 Solutions
Practical Management Science
Ch. 8.3 - Prob. 1PCh. 8.3 - Prob. 2PCh. 8.4 - Prob. 3PCh. 8.4 - Prob. 4PCh. 8.4 - Prob. 5PCh. 8.5 - Prob. 6PCh. 8.5 - Prob. 7PCh. 8.5 - In the lawn mower production problem in Example...Ch. 8.6 - Prob. 9PCh. 8.6 - Prob. 10P
Ch. 8.6 - Prob. 11PCh. 8.6 - Prob. 12PCh. 8.7 - Prob. 13PCh. 8.7 - Prob. 14PCh. 8.8 - Prob. 15PCh. 8.8 - Prob. 16PCh. 8.8 - Prob. 17PCh. 8.8 - Prob. 18PCh. 8.8 - Prob. 19PCh. 8 - Prob. 20PCh. 8 - Prob. 21PCh. 8 - Prob. 22PCh. 8 - Prob. 23PCh. 8 - Prob. 24PCh. 8 - Prob. 25PCh. 8 - Prob. 26PCh. 8 - Prob. 27PCh. 8 - Prob. 28PCh. 8 - Prob. 29PCh. 8 - Prob. 30PCh. 8 - Prob. 31PCh. 8 - Prob. 32PCh. 8 - Prob. 33PCh. 8 - Prob. 34PCh. 8 - Prob. 35PCh. 8 - Prob. 36PCh. 8 - Prob. 37PCh. 8 - Prob. 38PCh. 8 - Prob. 39PCh. 8 - Prob. 1CCh. 8 - Prob. 2C
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- 5- Airlines are known to jack up fares when peak travel season approaches, and they typically run their fare sales around slow seasons. This is an example of a ________ pricing strategy Group of answer choices everyday low pricing (EDLP) uniform premium high/low 6- Which of the following is NOT a goal of informative advertising? Group of answer choices inform customers about upcoming sales increase awareness explain how the product works build company image 7- A pricing strategy is Group of answer choices using one-time seasonal discounts to reduce inventory. a short-term approach to setting prices a long-term approach to setting prices in a companywide integrated effort using slotting allowances to gain access to distribution channels 8- I mentioned that the main tasks of advertising are to inform, remind, and persuade. At which stage of the product life cycle should the advertising focus on informing? Group of answer choices decline maturity…arrow_forwardAs a marketing manager, you are asked by the company leadership to formulate the right pricing strategy for the company's two TV broadcast programs, namely: (1) Hi-tech(H) program which contains engineering, science and technology; and (2) the Wildlife(W) program which contains adventure, vacation, and flora-fauna. There are at least 2 customer groups targeted by the program: (a) Geeks, and (b) Regular. For each group, the number of customers and their WTP values are presented in the table below. Groups Number of Customers Hi-tech Wildlife Geeks 3000 15 4 Regular 10000 3 8 Assuming that the production cost for the two programs is 0, then:a. Mention 3 pricing strategies that can be applied.b. Calculate the price level and profit earned by each strategy.c. As a manager, which pricing strategy did you choose? State why.arrow_forwardPricing Q: What are different factors that should be considered by marketers before deciding price of the product? Q: How the total cost is determined/calculated by company for deciding price of the product? Q: What is breakeven point? How is it calculated? Q: How the net profit is calculated? Q: write the following procedures and formulas for calculating price? a. Cost Plus pricing b. Breakeven pricing c. Return on investment pricing d. Value based pricing Q: Write the methods for determining pricing of new products?arrow_forward
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