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Marketing 3000 Final > Chapter 13: Price > Flashcards

Chapter 13: Price Flashcards

1
Q

What is a price?

A

The money or other considerations exchanged for the ownership or use of a product or service

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2
Q

List Price

A

Established price normally quoted to potential buyers

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3
Q

Price Equation

A

Final Price = List Price - (Incentives + Allowances) + Extra Fees

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4
Q

Value

A

The ratio of perceived benefits to price

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5
Q

High Value

A

Perceived Benefits > Price

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6
Q

Low Value

A

Perceived Benefits < Price

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7
Q

Value-Pricing

A

The practice of simultaneously increasing product and service benefits while maintaining or decreasing price

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8
Q

Profit Equation

A

Profit = [(Unit Price)(Units Sold)] - Total Fixed Costs - [(Unit Variable Cost)(Unit Sold)]

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9
Q

Pricing Objectives

A

Specifying the road of price in an organization’s marketing and strategic plans

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10
Q

Profitability Objective

A

Set prices with profits in mind

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11
Q

Volume Objective

A

Set prices with the attitude of h/s with the most sales wins

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12
Q

Pricing Constraints

A

Factors that limit the range of prices a firm may set

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13
Q

What are some examples of pricing constraints?

A

-Newness of product
-Legal and Ethical considerations
-Type of competitive market
Competitors’ prices

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14
Q

Demand Curve

A

A graph relating the quantity sold and price, which shows the max number of units that will be sold at a given price

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15
Q

Price of Elasticity Demand

A

Percentage of Change in Quantity Demanded / Percentage Change in Price

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16
Q

Elastic vs. Inelastic Demand

A

Greater than 1.0: Elastic
Less than 1.0: Inelastic

17
Q

What are some examples of Elasticity?

A

-Perceived as necessity
-Perceived as a luxury
-Role as a compliment to another product
-Availability of substitutes

18
Q

Total Revenue

A

Total money received from the sale of a product

19
Q

Price cuts

A

Increase revenue for products with elastic demand

20
Q

Price increases

A

Increase revenue for products with inelastic demand

21
Q

Break-Even Analysis

A

Relationship between total revenue and total cost to determine profitability at various levels of output

22
Q

Breakeven Point (BEP)

A

When Total Revenue = Total Cost

Marketing 3000 Final (6 decks)

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