Price Flashcards
Once a business has developed loyal customers and a good reputation…
it might be able to increase prices without demand falling too much.
As a business grows it can benefit from economies of scale. What does this mean?
The average cost of making each product falls, so the business can afford to lower its prices.
If a business is aiming to increase its market share…
might put its prices lower than its competitors to increase sales.
A business’ internal costs may change which…
can affect its prices.
When the product is in the introduction and growth phase…
a firm may charge a very low or a very high price to encourage people to buy it.
When the product is in the decline phase…
the firm may need to reduce the price in order to increase demand for the product again.
When the product is in the maturity phase…
a firm may need to bring its price in line with competitors prices.
