POM- Unit 3 Chapters 12- 17
What four factors must be taken into consideration to determine the "right" price for a product?
What are customers willing to pay for the product? Will enough money be made to pay for the development and production of the product? Will it generate enough sales dollars to pay for the marketing of the product? Will the product provide a profit for the company?
Demand- oriented
approaches to pricing regard expected customer tastes and preferences as the most important factors in the decision.
Demand-oriented, cost-oriented, profit-oriented, and competition-oriented are four approaches used to set Blank______.
approximate price levels
Small changes in price _____.
can have comparably big effects on company profit
Legal and regulatory issues and consumer demand are pricing ______ that limit what a company can charge for its products.
constraints
The relationship between price and quantity sold is called the ______.
demand curve
Pricing objectives involves specifying the role of price in what two areas of an organization?
its marketing plans its strategic plans
What element of the marketing mix has a unique role in that it is the place where all other business decisions come together?
price
What two elements are shown on a demand curve?
price quantity sold
The percentage change in quantity demanded relative to a percentage change in price is known as ______.
price elasticity of demand
cost-oriented
pricing approaches that consider the production and marketing costs and then add enough to cover direct expenses, overhead, and profit
When a marketing manager sets prices for all items in a product line, seeking to produce a profit for the entire line but not necessarily each product, it is known as
product-line pricing
Common approaches to pricing are oriented around which four elements?
profit demand competition cost
What is the definition of price?
the money or other considerations exchanged for the ownership or use of a product
Why must a marketing manager consider pricing objectives and constraints?
to narrow the range of choices among the variety of pricing strategies
In the profit equation, what is multiplied by quantity sold?
unit price
The ratio of perceived benefits to price is a product's
value
When using competition-oriented pricing approaches, price setters stress Blank______.
what "the market" is doing
Cost-oriented approaches to pricing consider which three things in the setting of a product's price?
Cost-oriented approaches to pricing consider which three things in the setting of a product's price? Multiple select question. profit consumer preferences overhead production costs product quality market share Correct Answer profit overhead production costs
According to the profit equation, profit equals ______.
total revenue minus total cost
