Problem Set Marketing Information GBA 5208 Hint: Read Chapters 17 and 18, and videos related to those chapters before doing this assignment. There is a separate video on markup and breakeven Analysis 1. (a) What pricing objective(s) is a skimming pricing policy most likely implementing? Is the same true for a penetration pricing policy? (b) Which pricing policy is probably most appropriate for each of the following products? i. a DVD of a best selling movie ii. a skin patch to help smokers quit iii. a "smart" infant/baby car seat that alerts the driver's cell phone when the child has unbuckled while the car is in motion, the child was accidentally left behind in the car, and the car is too hot or too cold iv. Nintendo's online SWITCH gaming subscription (10pts) 2. Is price discrimination involved if a large oil company sells gasoline to taxicab associations for 3.0 cents less per gallon than what its sells to retail service stations? The taxicab association will resell to taxi drivers. What happens if the taxi cab association resells gasoline to both taxicab drivers and to the general public? (10 pts) 3.. If a retailer sells a coat for $139.99. What was his markup if he bought the coat for $81.79? (15 pts) Markup in actual dollars? Express markup as a % of cost? Express markup as a % of selling price? *Remember that markup percentage is based on selling price unless otherwise noted in ALL of the remaining questions. 4. An kitchen/bath retailer purchased a mini chopper for $7.50. He plans to take a 30% markup. What will the selling price be? (5 pts) 5. An office supply store desires a minimum 40% markup at retail. If a case of copier paper will be sold at retail for $55.59/case, what is the maximum price the store can pay for them and still get its stated markup (40%)? (10 pts) 6. A sporting goods store has been offered a closeout purchase on softballs. The cost of each ball is $1.75, and it should retail for $7.49. What markup at the retail price would the store obtain? (5 pts) 7. The XYZ Fencing company sells a custom made wooden gate through wholesalers and retailers. The retail selling price is $850.00 and the manufacturing cost to the company is $325.00. The retail markup was 35 percent and wholesale markup was 20 percent. (10 pts) A. What was the cost to the wholesaler? B. What was the cost to the retailer? C. What percentage markup on selling price did the producer make? 8. Kitchenaid is considering expanding its countertop microwave line to include a new "smart" microwave that connects to other smart devices. The "smart" microwave will require additional expenditures both in manufacturing and marketing. Management seeks to determine a preliminary price for the new microwave. The fixed costs associated with manufacturing the microwave are $3,000,000. The variable costs are $410.50 per unit. Calculate the breakeven point in units at selling prices of $599.00, $699.00 and $799.00. Show your work. Through your research you know that "smart" devices are growing in popularity and that several key competitors are working on their own "smart" microwaves. Currently, there is no clear market leader in this emerging market for "smart" kitchen appliances. It is estimated that the total market for smart microwaves in the next year is 125,000 units. Which of these prices would you recommend and why? Please give a detail explanation for your decision (15 pts) 9. Yoplait has new line of Greek yogurt in a 9 oz size. The Marketing Manager plans to test market the product in one small market for three weeks. They have calculated the cost and projected sales for each of the different flavors: Plain cost is .65 each with projected sales of 11,000 units, strawberry cost per unit is .70 with projected sales of 14,000 units, blueberry cost is .78 per unit with projected sales of 11,000 units. Each yogurt product will retail at the same price. Using the average cost pricing and a 35% markup what will Yoplait price these products at the retail level? Remember to show your work. (10 pts) 10. MyAppliance+ is adding a new wine refrigerator to its appliance product mix. Launching the new wine refrigerator will require an investment of $350,000 to cover the fixed costs. The selling price is $175.00 with a variable cost of $89.99. MyAppliance+ wants to make at least $80,000 of profit the first year with this new product. How many wine refrigerators does the company have to sell to reach this profit goal? (10 pts) Total value of Assignment = 100 pts Do not just give answers. You must show your calculations for each answer. If you do not, then you will not receive credit (even if your answer is correct).