Chapter 17 Flashcards
The amount of money that is charged for something of value
Price
Target return objective
A specific level of profit as an objective
Profit maximizationobjective
And objective to get as much profit as possible
Sales oriented objective
An objective to get some level of unit sales without referring to profit
Administered prices
Consciously set prices aimed at reaching the firms objectives
One price policy
Offering the same price to all customers who purchase products under the essentially same conditions and same qualities
Flexible price policy
Offering the same products and quantities to different customers at different prices
Skimming price policy
Trying to sell to the top of the market at a high price before aiming at more price-sensitive customers
Penetration pricing policy
Trying to sell the whole market At one low price
Introductory price dealing
Temporary price cuts to speed new products into a market
Basic list prices
The prices that final customers are users are normally asked to pay for products
What are discounts
Reductions from the list price given by a seller to buyer
What are quantity discounts
Discounts offered to encourage customers to buy in larger amounts
What are cumulative quantity discounts
Reductions in price for larger purchases over a given period
What are non-cumulative quantity discounts
Reductions in price when a customer purchases a larger quantity on an individual order
What are seasonal discounts
Discounts offered to encourage buyers to buy earlier than present demand requires
What is net
An invoice term meaning that payment for the face value of the invoice is due immediately
What are cash discounts
Reduction in the price to encourage buyers to pay their bills quickly
2/10, net 30
Allows a 2% discount off the face value of the invoice if the invoice is paid within 10 days
What is a trade discount
And list price reduction to give it to channel members for the job they are going to do
What is a sale price
A temporary discount from the list price
What is every day low pricing
Setting a low list price rather than relying on frequent sales
What are allowances
Reduction in price given to the final customers for doing something or accepting less of something
What are advertising allowances
Price reduction’s to firms in the channel to encourage them to advertise or otherwise promote the firms products locally
What are stocking allowances
Allowances given to intermediaries to get shelf space for a product
Push money allowances
Allowance is given to retailers by manufacturers pass to the retailer sales clerks
What is the trade in allowance
The price reduction given for used products one similar new products are bought
What are rebates
Refunds to customers after purchase
F.O.B.
A transportation term meaning free on board some vehicle at some point
What is zone pricing
Making an average freight charge to all buyers within a specific geographic area
What is the uniform delivered pricing
Making an average freight charge to all buyers
What is freight absorption pricing
Absorbing freight cost so that affirms delivered price meets the nearest competitors
What is value pricing
Setting a fair price level for a marketing mix that really gives the target market superior customer value
What is the unfair trade practices act do
Puts a lower limit on prices
What is dumping
Pricing and product sold any foreign market below the cost of production or at a price lower than its domestic market
What are phony list prices
Miss leading prices that customers are shown to suggest that the price they are to pay has been discounted from list
What is the wheeler Lee amendment
Law that bans unfair or deceptive acts in commerce
What is price fixing
Competitors illegally getting together to raise lower or stabilize prices
What is the Robinson Patman act
A 1936 law that makes it illegal any price discrimination if it injures competition
What is price discrimination
Injuring competition by selling the same products to different buyers at different prices
