In which of the following pricing policies, a firm charges higher initial price for the product and reduces it over time as the demand at higher price is satisfied?

Match List I with List II: List I (Pricing Strategies) List II (Description) (A) Ramsay pricing (I) Setting a high price when a product is first introduced and gradually lowering price as it gains scale (B) Price skimming (II) Firm charges lower price (than the ongoing price) to gain market entry (C) Cost plus pricing (III) Price deviations from marginal cost should be inversely proportional to price elasticity of the product (D) Penetration pricing (IV) It is full cost pricing strategy that also includes mark up for target return, degree of competition, price elasticity and availability of substitutes. Choose the correct answer from the options given below:

A

(A) - (III), (B) - (IV), (C) - (I), (D) - (II)

B

(A) - (II), (B) - (I), (C) - (III), (D) - (IV)

C

(A) - (III), (B) - (I), (C) - (IV), (D) - (II)

D

(A) - (I), (B) - (IV), (C) - (II), (D) - (III)

Product line pricing strategy includes which combination of the following?
1. Public utility pricing
2. Complementary goods pricing
3. Spare parts pricing
4. Load factor pricing
Select the correct answer:

A

1, 2 and 3

B

2, 3 and 4

C

1, 2 and 4

D

1, 3 and 4

Identify three conditions that a firm must meet to practice price discrimination: A. The firm must have some control over the price and the product B. The firm must operate in the growth phase of its product life cycle C. The markets in which products are sold must be separable D. Price elasticity of demand for the product must differ E. The firm operates its plant at full capacity Choose the correct answer from the options given below:

A

A, B and C only

B

A, C and D only

C

B, D and E only

D

B, C and D only

Two stores A and B bought the same product from the company at the same price. Store A marked the price of the product 50% above its cost price and offered two successive discounts of 15% and 10% on the marked price of the product, while store B marked the price of the product 60% above its cost price and offered two successive discounts of 15% and 12% on the marked price of the product. If a customer buys the product from store B, he has to pay Rs. 986 more than that at store A. At what price the two stores bought the product from the company?

A

Rs. 15000

B

Rs. 20000

C

Rs. 25000

D

Rs. 30000

E

Rs. 35000

Cost plus pricing is considered appropriate for which combination of the following? (i) Product Tailoring (ii) Public Utility Pricing (iii) Refusal Pricing (iv) Monopoly Pricing Choose the correct answer from the code given below:

A

Only (i) and (ii)

B

Only (i), (ii) and (iii)

C

Only (ii), (iii and (iv)

D

Only (iii) and (iv)

Cost plus pricing is considered appropriate for which combination of the following?
i. Product Tailoring
ii. Public Utility pricing
iii. Refusal pricing
iv. Monopoly pricing
Choose the correct answer

A

Only (i) and (ii)

B

Only (ii), (iii) and (iv)

C

Only (i), (ii) and (iii)

D

Only (iii) and (iv)

Cost-plus pricing is considered appropriate for:
(I) Product Tailoring
(II) Public Utility Pricing
(III) Refusal Pricing
(IV) Monopoly Pricing

A

I and II only

B

I, II and III only

C

II, III and IV only

D

III and IV only

In pricing one new emerging model is Outcome Based Pricing Model. When pricing is done for the IT industry., which of these will represent Outcome Based Pricing?

A

Availability of resources for testing

B

The number of billable hours

C

The number of persons deployed for the project

D

Increase in profitability for the client

The charges for a five-day trip by a tourist bus for one full ticket and a half-ticket are Rs. 1440 inclusive of boarding charges which are same for a full ticket and a half-ticket. The charges for the same trip for 2 full tickets and one half-ticket inclusive of boarding charges are Rs. 2220. The fare for a half-ticket is 75% of the full ticket. Find the fare and the boarding charges separately for one full ticket.

A

Rs. 580, Rs. 400

B

Rs. 280, Rs. 200

C

Rs. 480, Rs. 300

D

Rs. 380, Rs. 400

Select the correct sequence of steps in setting a pricing policy.
1. Determining demand
2. Analysing competitors' costs, prices and offers
3. Selecting the final price
4. Selecting the pricing objective
5. Estimating costs
6. Selecting a pricing method

A

4, 1, 5, 2, 6 and 3

B

1, 5, 2, 4, 6 and 3

C

1, 2, 5, 4, 6 and 3

D

1, 2, 3, 4, 5 and 6

In which of the following pricing policies, a firm charges higher initial price for the product and reduces it over time as the demand at higher price is satisfied?

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