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MP Pricing 2021
Unit 4 Pricing
| Question | Answer |
|---|---|
| price | the value in money placed on a good or service |
| demand elasticity | the degree to which demand or change in demand for a product is affected by its price depending on certain factors: urgency, substitutes, brand name, etc. |
| price fixing | occurs when competitors agree on certain price ranges to set their prices |
| price discrmination | occurs when a firm charges different prices to similar customers in similar situations. |
| loss leader | when a business prices a product at a loss in order to draw customers into the store. |
| markup pricing | when re-sellers or retailers add an amount to the cost of the product in order to earn a profit |
| price lining | is a special pricing technique that sets a limited number of prices for specific groups or lines of merchandise. Example - Big Mac Jr, Big Mac Classic, and the Grand Big Mac |
| bundle pricing | a company offers several complementary products in a package that is sold at a single price |
| odd-even pricing | a technique that involves setting prices that all end in either odd or even numbers . Odd numbers convey a bargain like you are paying less |
| prestige pricing | sets higher than average prices to suggest status and high quality |
| everyday low prices (EDLP) | are low prices set on a consistent basis with no intention of raising them or offering discounts in the future - Walmart |
| special event pricing | items are reduced in a price for a short period of time, based on a specific happening. Halloween sale or back to school sale |
| cost plus pricing | this is used primarily by manufacturers and producers who sell large quantities of a product for a small percentage added after the cost of production are calculated |
| promotional pricing | used with other sales promotions where prices are reduced for a short period of time. Ex - buy one get one free, 25% off this weekend only, etc. |
| rebates | are refunds provided by the manufacturers after the sale. Usually mail in receipt and get money back later |
| coupon | are refunds at the cash register for a certain reduction in price |
| factors of demand | available substitutes, brand names, urgency of purchase, income are all |
| goals of pricing | earn a profit, gain market share, meet or beat the competition, and satisfy the customer needs and wants |
| consumer perceptions | feelings a customer has about a product can be influenced by its price |
| demand | what customers are willing to pay for a product |
| competition oriented pricing | involves pricing products based on the competition: above, below or in-line |
Created by:
janice ritchey
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