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Exam 17: Pricing of Services

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Question 41

Multiple Choice

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Accountants, architects, interior decorators, marriage counselors and lawyers typically use a _____ pricing strategy.

A) Going-rate
B) Perceived value
C) Fee for service
D) Price signaling
E) Cost-plus

F) C) and D)
G) A) and B)

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Question 42

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American Woman Fitness Centers offer first-time customers a 3-month membership for $59, a saving of $20 off the regular 3-month membership price. American Woman Fitness Centers' pricing strategy is aligned with which of the following customer definitions of value?

A) Value is all that I get for all that I give
B) Value is everything I want in a service
C) Value is low price
D) Value is reliable service
E) Value is the quality I get for the pace I pay

F) B) and E)
G) A) and D)

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Question 43

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The three types of complementary pricing are:

Bell Atlantic NYNEX Mobile introduced its Talk Along portable phone service at a price of $14.99 a month. Bell Atlantic is using a(n) _____ pricing strategy.

If you visit a county or state fair, you will pay a basic admission fee plus other fees if you want to enjoy any of the amusement rides. County and state fairs that price this way is using:

In a _____ pricing strategy, new services are introduced at high prices with large promotional expenditures.

Price signaling is typical in markets with a high concentration of sellers.

Which of the following is NOT a type of differential used by service providers to synchronize demand and supply?

What are the two types of market segmentation commonly used by service providers?

Because most people like to get tattoos and body piercings on the weekends, a tattoo parlor in Portland, Maine, offers a reduced rate Monday to Thursday for all of its services. Prices on Friday and Saturday are 45 percent higher than they are during the rest of the week. The tattoo parlor is using a(n) _____ pricing strategy.

Which of the following approaches to pricing considers that customers may judge quality on the basis of pace?

University presidents often have access to funding to pay to have widely recognized people, such as Mikhail Gorbachev, Maya Angelou or Jimmy Carter come to their campuses as speakers. When negotiating with speakers' bureaus for the services of these individuals, college presidents are primarily concerned with the "get" component of a service and monetary price is not of primary concern. What types of pricing strategies should the speakers' bureau use if they wish to appeal to the value as defined by the university presidents?

Which of the following statements describes a problem in cost-based pricing for services?

_____ is a form of competition-based pricing that involves charging the most prevalent price on the market for a service.

One of the problems associated with cost-based pricing is the heterogeneity of services, which limits comparability.

The basic formula for _____ is Price = Direct costs + Overhead + Profit margin.

To calculate what it charges a client, a detective agency charges $200 a day direct costs plus an additional $50 per day to pay for office expenses, licenses and other fixed costs and fifteen percent of full costs for the profit margin. What type of pricing strategy is being used by the detective agency?

Search costs are the costs invested to identify and choose from services you desire.

The ad for legal services that Marla saw indicated the lawyers would receive no money unless their client did. To Marla, this statement indicated the legal firm offering this service was using:

Demand-based pricing does not consider that customers might be sensitive to nonmonetary prices and may judge quality on the basis of price.