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Marketing Exam 4 > Chapter 18 > Flashcards

Chapter 18 Flashcards

1
Q

What is a Barter ?

A

the trading of products

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2
Q

What is Price Competition?

A

and matching or beating competitor’s prices

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3
Q

What is non-price competition?

A

Characteristics other than price to distinguish a product from competitive brands

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4
Q

What is the formula for profit and profits

A
  • Profit = T. revenue - T. Cost

- Profits = (Price x Quantity sold) - T. Costs

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5
Q

What is Markup?

A

is the difference between the cost of a good and its selling price

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6
Q

What is Price Elasticity of demand?

A

a measure of the sensitivity of demand to changes of price

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7
Q

What is an elastic demand?

A

A change in price causes an opposite change in QD

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8
Q

What are some Elasticity Determinants?

A
  • Availability of substitutes
  • Percentage of income
  • Necessity
  • Time
  • Brand Equity
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9
Q

What is an Break-Even Point?

A
  • Where costs of producing a product equal the revenue
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10
Q

What is Marginal Analysis?

A

Examines what happens to a firm’s costs and revenues when production or sales volumes changes by one unit

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11
Q

What is Marginal Cost?

A

is extra cost incurred for producing one more unit of product

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12
Q

What is Marginal Revenue?

A

change in total revenue when a firm sells one additional unit of product

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13
Q

What is the formula for Average Fixed Costs?

A

Fixed Costs/Units Produced

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14
Q

What is the formula for Average Variable Costs?

A

Variable Costs/Units Produces

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15
Q

What are some reference Prices?

A
  • Internal and external reference price
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16
Q

What is Reference Price?

A

The price stored in memory that helps to evaluate the actual price

17
Q

What is Internal Reference Price?

A

Develops in buyer’s mind through experience with product

18
Q

What is External Reference Price?

A

A comparison price provided by others

19
Q

What is Price Framing? EX

A
  • Anchoring price for consumers

- MSRP, Competitiors Price, “You Save”

20
Q

What is Bundling ?

A

Offering several products for sale in one “package”

21
Q

What are some Price strategies?

A
  • Framing
  • Bundling
  • Unbundling
22
Q

Which are some Pricing Objectives?

A
  • Sales Oriented

- Profit oriented

23
Q

What is Sales Oriented?

A

Set prices low to maximize sales

24
Q

What is Profit Oriented?

A

Pricing strategy focused on profits

25
Q

What is target profit pricing?

A

All products must have at least a 10% profit marging

26
Q

What is Maximize profits?

A

Use sophisticated mathematical models to maximize profits

27
Q

What is customer oriented?

A

focused on providing value

28
Q

What some general pricing Strategies?

A

Skimming, Penetration, Neutral

29
Q

What is skimming useful with? Ex?

A
  • Useful with inelastic demand, early life cycle stage

- Consulting, Health Care

30
Q

what is Penetration useful with? Ex?

A
  • Useful with elastic elastic demand

- Fast food

Marketing Exam 4 (6 decks)

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