Chapter 13 Flashcards
Which of the four P’s is the forgotten p ?
price
is the amount of money EXCHANGED for products and services
what is this ?
price
price is what the consumer ____ ?
pays
value is what the consumer ___ ?
receives
value = ?
perceived benefits / price
- identify pricing objectives and constraints
- estimate demand and revenue
- determine cost, volume, and profit
- select an approximate price level
- set the price
- make special adjustments
what are these ?
six steps in setting price
*profit
*sales
*market share
*unit volume
*survival
*social responsibility
what are these ?
objectives and constraints in the identifying pricing step of setting price
market share = ?
unit brand sales / unit category sales
- How will the price vs quantity combination affect my firms financials?
- How will consumers respond to price changes (price sensitivity)?
what are these ?
the two key questions to asl to find out how to estimate demand
effective marketing can make brands more elastic or inelastic ?
inelastic
increased competitiveness can make a brand more elastic or inelastic if not differentiated ?
elastic
Total cost = ?
fixed cost + variable cost
Contribution margin = ?
price (per unit) - variable cost (per unit)
a technique that analyzes total revenue and total cost to determine profitability at various quantities
what is this ?
break-even analysis
shows the quantity sold needed to cover costs
what is this ?
break even point
break even point = ?
fixed cost / unit price - unit variable cost
measures the relationship between PRICE and the QUANTITY DEMANDED
what is this ?
price elasticity of demand
___ type items usually have more elastic demand curves ?
luxury
____ type items usually have more inelastic demand curves ?
necessity type
profit = ?
total revenue - total cost
the quantity produced or sold, as a pricing objective
what is this ?
unit volume
- pure competition
- monopolistic competition
- oligopoly
- pure monopoly
what are these ?
the 4 competitive situations
the percentage change in quantity demanded relative to a percentage change in price
what is this ?
price elasticity of demand
the total money received from the sale of a product
what is this ?
total revenue
the graphic presentation of the break even analysis that shows when total revenue and total cost intersect to identify profit or loss for a given quantity sold
what is this ?
break even chart
Necessity
Inelastic
Non neccesaty products
Elastic
