Marketing- Price

Question 1

What is price skimming

Answer 1

High introductory price then is slowly lowered over time

Question 2

What is penetration pricing

Answer 2

Set a low price in order to attract word of mouth

Question 3

What is competition-based pricing

Answer 3

Setting a price based on what competitors charge

Question 4

What is psychological pricing

Answer 4

Set based on the theory that certain prices have more of an effect on the customer

Question 5

What is cost plus pricing

Answer 5

A fixe percentage plus the cost to make the product per unit

Question 6

What is marginal pricing

Answer 6

setting the price of a product to equal the extra cost of producing an extra unit of output

Question 7

What is contribution pricing

Answer 7

A fixed percentage plus the direct costs per unit

Question 8

What is price elasticity of demand

Answer 8

percentage change in quantity demanded of a product to the percentage change in price

Question 9

What is income elasticity of demand

Answer 9

sensitivity to changes in consumer income relative to the amount of a good that consumers demand

Question 10

What is cross elasticity of demand

Answer 10

how sensitive the demand for a product is to changes in the price of another product.

Question 11

Usefulness of price elasticity of demand

Answer 11

Helps to forecast consumer behaviour in order to forecast an economic recession