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17 Cards in this Set

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different names for price
tuition, rent, interest, premium, fees, dues, fare, salary, commission, wage
price
is the money or other considerations exchanges for the ownership or use of a good or service
value
the ratio of perceived benefits to price

value=percieved benefits/price
value pricing
the practice of simulataneously increasing product and service benefits while maintaining or decreasing price
steps in setting prices
1)identigying pricing objectives and contraints
2)estimate demand and revenue
3)determine cost, volume, and profit relationships
4)select approximate price level
5)set list or quoted price
6) make special adjustments to list or quoted price
types of competition and pricing
pure monopoly->one seller
oligopoly->few sellers
monopolistic ->many sellers
pure competition-> many sellers with identical products
pricing objectives
expectations that specify the role of price in an organizations marketing and strategic plans
constraints
factors that limit the range of prices a rfrim may set
movement along
assumes that other factors (tastes, price, substitutes, income) remain unchanged
shift
if tastes, income, and demand change
formula for total revenue
tr = p x q
price elasticity of demand
the percentage change in quantity demanded relative to a percentage change in price

elastic = >1
inelastic = <1
unitary = 1
breakeven point
the quantity at which total revenue and total cost are equal

BEP = Fixed cost/ (unit price- unit variable cost)
fixed cost
sum of expenses of the firm that are stable and do not shcnage with the quantity of a product that is produced and sold
variable cost
sum of expenses of the firm that vary directly with the quantity of a product that is produced and sold
marginal analysis
deals with the trade off of incremental costs against incremental revenues
break even analysis
technique that analyzes the relationship between total revenue and total cost determing profitabiltiy at various levels of output