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MGT 103 > week 6 > Flashcards

week 6 Flashcards

1
Q

What is the only marketing mix variable that can be changed quickly?

A

price

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2
Q

What is price related to?

A

total revenue and profit

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3
Q

What is price?

A

the assignment of value, or the amount the consumer must exchange to receive the offering

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4
Q

What does price include?

A

money, effort, time, favors, votes, or anything else that has value to the other party

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5
Q

What is inelastic demand?

A

a change in price results in a little or no change in quantity demanded

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6
Q

What is elastic demand?

A

a change in price causes a great(opposite) change in quantity demanded

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7
Q

What are fixed costs?

A

costs that dont change with the number of units produced (be that 100 or 10,000)

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8
Q

What happens as to fixed costs as units produced increases?

A

the average cost per unit will always decrease

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9
Q

What are variable costs?

A

production costs that are tied to the number of units produced and thus vary depending on volume

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10
Q

What goes into variable costs?

A

cost of raw materials, credit card fees, piece rate labor, sales commissions, delivery expenses

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11
Q

What goes into fixed costs?

A

rent, mortgage payment, insurance, computers, salary of full-time workers, advertising

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12
Q

What is Break-Even Point?

A

the point at which the costs of producing a product is equal to the revenue made from selling the product

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13
Q

What is contribution margin?

A

difference between total revenue and total variable costs

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14
Q

What is contribution unit margin?

A

price - variable costs

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15
Q

What does the importance of price depend on?

A

type of product, type of target market, and purchase situation

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16
Q

What is cost based pricing?

A

calculate price based on company’s costs

17
Q

What is competitive based pricing?

A

benchmarking on competitor’s prices

18
Q

What is demand based pricing?

A

setting a price based on what consumers are willing to pay

19
Q

Wha is dynamic pricing?

A

the practice of varying the price for a product or service to reflect changing market conditions

20
Q

What is captive pricing?

A

pricing strategy where the price of one product is tied to the price of another product

21
Q

What is price skimming?

A

a firm charges the highest initial price that customers will pay and then lowers it over time

22
Q

What is penetration pricing?

A

a marketing strategy implemented to draw customers to a new product or service

23
Q

What is trial pricing?

A

allows prospective customers to try your product or service for a limited time, usually for free or for a small fee

24
Q

What is anchoring?

A

influences how buyers perceive advertisements

25
Q

What is buyers’ expectations?

A

The expectations that buyers have concerning the future price of a good, which is assumed constant when a demand curve is constructed

26
Q

What is internal reference prices?

A

the price point that a customer expects to pay for a product or service, shaped by their past experiences and purchasing history

27
Q

What is odd-even pricing?

A

a popular psychological marketing technique that involves pricing items with an odd or even ending, such as $0.99 or $1.00

28
Q

What is price lining strategy?

A

selling different products at different price points to cater to customers who are looking for different levels of quality, convenience, and value

29
Q

What is prestige pricing?

A

a pricing strategy in which prices are set at a high level, buyers will associate a high price for the product with superior quality

30
Q

What is loss-leader pricing?

A

prices a product lower than its production cost in order to attract customers or sell other, more expensive products

31
Q

What is predatory pricing?

A

the illegal business practice of setting prices extremely low in an attempt to eliminate the competition and establish a monopoly

32
Q

What is bait and switch pricing?

A

advertising an item at an unrealistically low price as ‘bait’ to lure customers to a store or selling place and then attempting to steer them to a higher-priced item

MGT 103 (7 decks)

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