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5.01 notes
Question | Answer |
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What is price? | That is which is given up in exchange to acquire a good or service |
What is revenue? | The price charged to customers multiplied by the number of units sold |
What is profit? | Revenue minus expenses |
What are trends that influence price? | Flood of new products, increased availibility of bargain-priced private and generic brands, and cutting prices. |
What is profit maximization? | Setting prices to that total revenue is as large as possible relative to total costs |
What is market share? | A company's product sales as a percentage of total sales for that industry |
What is sales maximization? | A short-term objective to maximize sales |
What is status quo pricing objectives? | Maintaining existing prices |
What is demand? | The quantity of a product that will be sold i the market at various prices for a specified period |
What is supply? | The quantity of a product that will be offereed to the market by a supplier at various prices for a specific period. |
What is price equilibrium? | The price a which demand and supply are equal |
What is elastic demand? | When consumers by more or less of a product when the price changes |
What is inelastic demand? | An increase or decrease in price will not significantly affect demand |
What is unitary elasticity? | An increase in sales exactly offsets a decrease in prices and revenue is unchanged |