Marketing Ch 10

question

price

answer

the amount of money charged for a product or service, or the sum of the values that customers exchange for the benefits of having or using the product or service

question

value based pricing

answer

uses the buyers' perceptions of value, not the sellers cost, as the key to pricing

question

value-based pricing

answer

is customer driven

question

cost-based pricing

answer

is product driven

question

price

answer

is set to match perceived value

question

good-value pricing

answer

is offering just the right combination of quality and good service at a fair price

question

everyday low pricing

answer

involves charging a constant everyday low price with few or no temporary price discounts

question

high low pricing

answer

involves charging higher prices on an everyday basis but running frequent promotions to lower prices temporarily on selected items

question

value-added pricing

answer

attaches value-added features and services to differentiate offers, support higher prices, and build pricing power

question

cost-based pricing

answer

sets prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for effort and risk

question

fixed costs

answer

the costs that do not vary with production or sales level
rent
heat
interest
executive salaries

question

variable costs

answer

vary directly with the level of production (raw materials, packaging)

question

total costs

answer

are the sum of the fixed and variable costs for any given level of production

question

cost-plus pricing

answer

adds a standard makeup to the cost of the product

question

cost-plus pricing benefits

answer

-Sellers are certain about costs
-Prices are similar in industry and price competition is minimized
-Buyers feel it is fair

question

cost-plus pricing disadvantages

answer

Ignores demand and competitor prices

question

break-even pricing

answer

setting price to break even on the costs of making and marketing a product, or setting price to make a target return

question

competition-based pricing

answer

setting prices based on competitors' strategies, prices, costs, and market offerings

question

Target costing

answer

starts with an ideal selling price based on consumer value considerations and then targets costs that will ensure that the price is met

question

Organizational Considerations

answer

Who should set prices?
Who can influence prices?

question

Pricing in different types of markets

answer

pure competition, monopolistic competition, oligopolistic competition, pure monopoly

question

demand curve

answer

shows the number of units the market will buy in a given period at different prices

question

Demand and price

answer

are inversely related

question

Higher price =

answer

lower demand

question

price elasticity

answer

a measure of the sensitivity of demand to change in price

question

inelastic demand

answer

when demand hardly changes with a small change in price

question

elastic demand

answer

when demand changes greatly with a small change in price

question

The economy and other external factors

answer

economic conditions, reseller's response to price, government, social concerns

1 of 28

question

price

answer

the amount of money charged for a product or service, or the sum of the values that customers exchange for the benefits of having or using the product or service

question

value based pricing

answer

uses the buyers' perceptions of value, not the sellers cost, as the key to pricing

question

value-based pricing

answer

is customer driven

question

cost-based pricing

answer

is product driven

question

price

answer

is set to match perceived value

question

good-value pricing

answer

is offering just the right combination of quality and good service at a fair price

question

everyday low pricing

answer

involves charging a constant everyday low price with few or no temporary price discounts

question

high low pricing

answer

involves charging higher prices on an everyday basis but running frequent promotions to lower prices temporarily on selected items

question

value-added pricing

answer

attaches value-added features and services to differentiate offers, support higher prices, and build pricing power

question

cost-based pricing

answer

sets prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for effort and risk

question

fixed costs

answer

the costs that do not vary with production or sales level
rent
heat
interest
executive salaries

question

variable costs

answer

vary directly with the level of production (raw materials, packaging)

question

total costs

answer

are the sum of the fixed and variable costs for any given level of production

question

cost-plus pricing

answer

adds a standard makeup to the cost of the product

question

cost-plus pricing benefits

answer

-Sellers are certain about costs
-Prices are similar in industry and price competition is minimized
-Buyers feel it is fair

question

cost-plus pricing disadvantages

answer

Ignores demand and competitor prices

question

break-even pricing

answer

setting price to break even on the costs of making and marketing a product, or setting price to make a target return

question

competition-based pricing

answer

setting prices based on competitors' strategies, prices, costs, and market offerings

question

Target costing

answer

starts with an ideal selling price based on consumer value considerations and then targets costs that will ensure that the price is met

question

Organizational Considerations

answer

Who should set prices?
Who can influence prices?

question

Pricing in different types of markets

answer

pure competition, monopolistic competition, oligopolistic competition, pure monopoly

question

demand curve

answer

shows the number of units the market will buy in a given period at different prices

question

Demand and price

answer

are inversely related

question

Higher price =

answer

lower demand

question

price elasticity

answer

a measure of the sensitivity of demand to change in price

question

inelastic demand

answer

when demand hardly changes with a small change in price

question

elastic demand

answer

when demand changes greatly with a small change in price

question

The economy and other external factors

answer

economic conditions, reseller's response to price, government, social concerns

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Marketing Ch 10

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