Marketing Principles: Chapter 11
Cost-plus pricing refers to:
Summing the total unit cost of providing a product or service and adding a specific amount to the cost to arrive at the price
Setting a price to achieve an annual target return-on-investment (ROI) is referred to as:
Target return-on-investment pricing
A firms profit equation demonstrates that profit equals _______
Total Revenue- total cost
Price refers to:
the money or other considerations (including other products and services) exchanged for the ownership or use of a product or service
Barter refers to
the practice of exchanging products and services for other products and services rather than for money
Adding a fixed percentage to the cost of all items in a specific product class is referred to as:
Standard markup pricing
Setting a market price for a product or product class based on a subjective feel for the competitor's price or market price as the benchmark is referred to as:
Above-,at-, or below-market pricing
Yield management pricing refers to:
Charging different prices to maximize revenue for a set amount of capacity at any given time
Demand refers to:
Consumers willingness and ability to pay for products and services
Deliberately selling a product below its customary price, not to increase sales, but to attract customers attention in hopes that they will buy other products as well, is referred to as:
Loss-leader pricing
The ratio of______ to price is referred to as value
Perceived Benefits
The horizontal axis of a demand curve graph represents:
Quantity Demanded
Prestige pricing refers to:
Setting a high price so that quality or status conscious consumers will be attracted to the product and buy it.
Odd-even pricing refers to:
Setting prices a few dollars or cents under an even number
Target return-on-sales pricing refers to:
Setting prices to achieve a profit that is a specified percentage of the sales volume.
Skimming pricing refers to:
setting the highest initial price that customers really desiring the product are willing to pay when introducing a new or innovative product