Price, the amount of money that has to be paid to acquire a given product. Insofar as the amount people are prepared to pay for a product represents its value, price is also a measure of value (Caldwell, 2012). In our daily life, shopping become an indispensable part of us, people are spend most of their money to buy everything, like articles of daily use, electronic products, house, car and service, only on the Online shopping in the UK is to experience growth this year as consumers are set to spend an average of £1,174 via the web in 2015, which is up 9.6 per cent on 2014 (Terrelonge, 2015), from the information, can show that people were spend more money on shopping, in modern network coverage is more and more deep, people can have a clear
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And the rareness also will make customers pay the product by a high price, such as, in the early part of the 20th Century overfishing followed by new conservation laws meant the price of lobster started to rise. 2012 saw an 18% rise in the price of lobster and as of 2014 the cost was roughly $7.95/lb. The example clearly shows that emphasizing the scarcity of a product and changing the setting in which it is served can impact on people’s perception of value (Heeraman, 2015). Price is one of the major contributing factors to our perception of value, we want to set up a price to a new product, if the price is too high, people will think about it, it is this product have any extra effect we do not know about it, if the price is too low, the customers will thing that is this product was inferior quality? Two glasses of wine, we set up one of them £9 and the other one £45 delivers results showing people perceive the more expensive wine to be nicer. Odd number pricing also can mislead the customers, Odd pricing is a pricing method aimed at maximizing profit by making micro-adjustments in pricing structure. It relies on the assumption that consumers are calculation-averse and will …show more content…
Cost means that the total money, time and resources associated with a purchase or activity (Hansen, Mowen, & Guan, 2007). the cost can divide into direct cost and indirect cost. What is direct cost? Direct costs can be traced directly to a cost object such as a product or a department. In other words, direct costs do not have to be allocated to a product, department, or other cost object (Averkamp, 2004), for example, if a company produces artisan furniture, the cost of the wood and the cost of the craftsperson are direct costs—they are clearly traceable to the production department and to each item produced—no allocation was needed. On the other hand, the rent of the building that houses the production area, warehouse, and office is not a direct cost of either the production department or the items produced. Indirect costs are those which affect the entire company, not just one product. They are costs like advertising, depreciation, general supplies for your firm, accounting services, etc. They are services, and costs, for your entire firm, not just one product. Indirect costs are often called, simply, overhead. Overhead is another name for all the ongoing costs of operating a business that aren 't directly associated with the making the product of the offering of the service (Peavler, 2016). Most of companies will to control their cost for the product, when they control the cost they can make more profit from the
And the rareness also will make customers pay the product by a high price, such as, in the early part of the 20th Century overfishing followed by new conservation laws meant the price of lobster started to rise. 2012 saw an 18% rise in the price of lobster and as of 2014 the cost was roughly $7.95/lb. The example clearly shows that emphasizing the scarcity of a product and changing the setting in which it is served can impact on people’s perception of value (Heeraman, 2015). Price is one of the major contributing factors to our perception of value, we want to set up a price to a new product, if the price is too high, people will think about it, it is this product have any extra effect we do not know about it, if the price is too low, the customers will thing that is this product was inferior quality? Two glasses of wine, we set up one of them £9 and the other one £45 delivers results showing people perceive the more expensive wine to be nicer. Odd number pricing also can mislead the customers, Odd pricing is a pricing method aimed at maximizing profit by making micro-adjustments in pricing structure. It relies on the assumption that consumers are calculation-averse and will …show more content…
Cost means that the total money, time and resources associated with a purchase or activity (Hansen, Mowen, & Guan, 2007). the cost can divide into direct cost and indirect cost. What is direct cost? Direct costs can be traced directly to a cost object such as a product or a department. In other words, direct costs do not have to be allocated to a product, department, or other cost object (Averkamp, 2004), for example, if a company produces artisan furniture, the cost of the wood and the cost of the craftsperson are direct costs—they are clearly traceable to the production department and to each item produced—no allocation was needed. On the other hand, the rent of the building that houses the production area, warehouse, and office is not a direct cost of either the production department or the items produced. Indirect costs are those which affect the entire company, not just one product. They are costs like advertising, depreciation, general supplies for your firm, accounting services, etc. They are services, and costs, for your entire firm, not just one product. Indirect costs are often called, simply, overhead. Overhead is another name for all the ongoing costs of operating a business that aren 't directly associated with the making the product of the offering of the service (Peavler, 2016). Most of companies will to control their cost for the product, when they control the cost they can make more profit from the