9.0F

Front 1

Cash discounts:

Back 1

Discounts offered to buyers as an incentive for paying the invoice amount within a specified number of days.

Front 2

Competition:

Back 2

A rivalry between businesses to attract scarce consumer dollars.

Front 3

Cost of merchandise sold:

Back 3

The amount paid by a business for products purchased for resale or for use in the production of other goods.

Front 4

Cost-oriented pricing:

Back 4

Implemented by carefully examining all of the costs associated with carrying a product and selling it to consumers then adding the desired profit to arrive at a selling price.

Front 5

Cost-plus pricing:

Back 5

A pricing strategy that examines costs for individual products or services and adds a standard markup.

Front 6

Cumulative quantity discounts:

Back 6

Based on a buyer’s total purchases during a specified period of time.

Front 7

Demand:

Back 7

The number of products consumers are willing to buy at a given time and a given price.

Front 8

Demand oriented pricing:

Back 8

Most effective when selling products with inelastic demand, this pricing strategy requires price planners to estimate the value customers place on products and set prices accordingly.

Front 9

Direct competition:

Back 9

Competition between businesses that have similar formats and sell similar products.

Front 10

Elastic demand:

Back 10

Demand that is sensitive to a change in price of the product.

Front 11

Fixed costs:

Back 11

Costs that remain constant over a period of time regardless of sales volume.

Front 12

Fixed pricing:

Back 12

(One-Price Policy) A policy under which an organization charges the same prices to all customers regardless of the quantity of the purchase.

Front 13

Indirect competition:

Back 13

Competition between businesses that have dissimilar formats and sell dissimilar products.

Front 14

Inelastic demand:

Back 14

Demand that is not sensitive to a change in price of the product.

Front 15

Loss leaders:

Back 15

A product that is sold below costs in an effort to increase customer traffic.

Front 16

Markdowns:

Back 16

Reductions in selling price used to stimulate sales, dispose of slow moving/discontinued merchandise, meet competitors’ prices, and/or increase customer traffic.

Front 17

Market price:

Back 17

The price that prevails in the market for a particular good at a specific time.

Front 18

Markup pricing:

Back 18

Pricing strategy that adds a predetermined percentage to the cost of products.

Front 19

Non-price Competition:

Back 19

Competition based on factors other than price as a means to attract customers.

Front 20

Non-cumulative quantity discounts:

Back 20

Reductions given to buyers for a one-time purchase or shipment.

Front 21

Odd/even cent pricing:

Back 21

Psychological pricing technique based on the principle that prices ending in odd numbers ($5.99) communicate a bargain and prices ending in even numbers ($6.00) communicate quality

Front 22

Opportunity cost:

Back 22

The opportunity cost is the option that is given up when a consumer chooses one product/service over another.

Front 23

Penetration pricing

Back 23

Setting a low price when introducing a product into a competitive market to motivate customers to purchase.

Front 24

Prestige pricing:

Back 24

Pricing technique that sets a higher-than-average price for products in order to communicate quality and status.

Front 25

Price:

Back 25

The amount charged to customers in exchange for goods and services

Front 26

Price Competition:

Back 26

Competition that uses price as the primary means to attract customers.

Front 27

Price lining:

Back 27

Establishing price points between products in a product line to communicate differences in quality and/or service to consumers.

Front 28

Profit:

Back 28

Revenue remaining after the expenses of running the business have been deducted from income.

Front 29

Promotional pricing:

Back 29

Selling a product at a temporarily lower price in order to attract customers.

Front 30

Psychological pricing:

Back 30

Pricing technique based on the belief that customers form their perceptions of products on price and these perceptions affect customer buying decisions.

Front 31

Quantity discounts:

Back 31

Reduction in price given by manufacturers/ wholesalers when a large or specified quantity is purchased.

Front 32

Skimming pricing

Back 32

Setting a high price when introducing a product that has little competition and will appeal to customers who like to be the first to have the latest products.

Front 33

Supply:

Back 33

The number of products manufacturers are willing to produce at a given time and at a given price.

Front 34

Trade discounts:

Back 34

(Functional discounts) Discounts offered to channel members for performing certain functions like storing or record keeping.

Front 35

Unit pricing:

Back 35

: Stating the price of a product per unit of standard measure.

Front 36

Variable costs

Back 36

Costs that vary based on sales volume or changes in business needs

Front 37

Variable pricing:

Back 37

Flexible-Price Policy) Pricing technique that encourages customers to bargain with sellers in an effort to obtain the best price for products and services.