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Exam 15: Pricing of Services

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Question 21

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List three groups of service providers that typically use results-based pricing.

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Lawyers,real estate agents,tra...

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Question 22

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What type of pricing strategy will most likely be used by marriage counselors,bridal consultants,public accountants,and tax attorneys?

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Question 23

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Loss leadership is the term typically used when providers place a familiar service on special to draw the customer to the store and then reveal other levels of service available at higher prices.

In which of the following service industries are you most likely to find the service provider using fee for service pricing?

A resort that has identified young upper-middle class parents as a market segment charges $1,750 for a four-day,three-night package for a mother,father and two children.The package includes golf fees and tennis court fees for the parents and a five-hour a day adult-supervised camp for the children.The ordinary four-day,three-night package for four costs $1,200.A single day at the camp for any child between the ages of 3 and 11 is $60.What kind of market segmentation pricing strategy is the resort using?

In which of the following service industries would you most likely find the service provider using competition-based pricing?

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

Kendra teaches swimming lessons at the YWCA pool.She will charge $75 per child for four weeks worth of lessons.Payment is not due until the child can swim the length of the pool.If the child cannot accomplish this task,he or she will be automatically enrolled in the next swimming lesson session until the child can swim the length of the pool.At that time,the parents will be expected to pay the $75.The YWCA is using a _____ pricing strategy.

Which of the following statements does NOT describe how consumers typically define value?

Cost-plus pricing is more likely to be used by lawyers than by the construction industry.

Price framing would be used when the customer defines value as:

_____-based pricing is used when there are a small number of large service providers.

Which of the following statements describes a problem with demand-based pricing for services?

American Airlines BreakAway fares offer travelers substantial savings on nonstop flights from Newark,New Jersey to Los Angeles from mid-August to mid-October.The round-trip airfare is $299 for customers who depart on Friday and return the following Monday or Tuesday.American Airlines is using a(n) _____ differential.

Which of the following is an example of competition-based pricing strategy?

A day after US Airways announced its new low fares for the autumn on travel from New York (i.e.,Newark and LaGuardia Airports) to selected cities in the U.S.and Canada,American Airlines matched their fares.American Airlines is using a _____ strategy.

What kind of pricing strategy explains why a traveler is willing to pay $400 to fly first class when he or she could get to the same destination by paying $125?

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

_____-based pricing occurs in services that are standardized across providers.

All of the following are situations in which a penetration pricing strategy would be appropriate EXCEPT: