Chapter 13 Flashcards
Price
Money or other considerations In exchange for ownership or use of a product
Barter
Practice of exchanging products for other products
Value
Ration of perceived benefits price
=Perceived Benefits/Price
Value-Pricing
Practice of simultaneously increasing a product and service benefit while maintaining or decreasing price
Profit Equation
Total Revenue - Total Cost
Or
Unit Price * Quantity Sold - (Fixed Variable Price)
Pricing Objectives
Specify the role of price in an organizations marketing and strategic plans
Pricing Constraints
Factors that limit the range of prices a firm may set
Demand Curve
Graph relating quantity sold, and price, which shows the max number of units that will be sold at a given price
Demand Factors
Determine consumers willingness and ability to pay for products
Price Elasticity of Demand
% Change in quantity relative to a percent change in price
% Change in quantity / % change in price
Total Revenue
Total money received from sales of product
TR = P * Q
Total Fixed Cost
Total expense incurred by a firm producing and marketing products.
TC = FC + VC
Break-Even Analysis
Technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output.
BEP = (Fixed Cost - Unit Variable Cost)
Final Price
=List Price - (Incentives and Allowances) + Extra Fees
Price Examples
Tuition
