chapter 11 learn smart
profit manufacturing costs overhead
Cost-oriented approaches to pricing considers which of the following in the setting of a products price?
pricing objectives
Marketing managers may identify profit, market share, social responsibility, or even survival as
predatory pricing and price fixing
Pricing practices that are legally restricted
variable
_____ cost is the sum of the expenses of the firm that vary directly with the quantity of a product that is produced and sold
standard
_____ markup pricing entails adding a fixed percentage to the cost of all items in a specific product class
demand-oriented pricing
________ approaches weigh factors underlying expected customer taste and preferences more heavily than other factors
one-price
a _____ policy is also known as fixed pricing
dynamic
a _____ pricing policy allows for more responsiveness to demand, cost, and competitive factors than does a fixed-price policy
levels of price
a demand curve is derived by measuring how many units of a product are sold at various
penetration
a firm may introduce a new product with _____ pricing by using a low initial price designed to appeal to the many customers that are believed to be price sensitive
promotional allowance
a price reduction offered to channel members for featuring the manufacturer's product in their advertising or selling activities
elastic
a product with _____ demand is one in which a slight decrease in price results in a relatively large increase in demand or units sold
add extra fees subtract incentives and allowances
according to the price equation, to find the actual price, you should do which of the following to the list price?
total cost and total revenue
break-even analysis analyzes the relationship between which two at various levels of output?
competition-oriented demand-oriented cost-oriented
common approaches to setting an approximate price level for a product
demand factors
consumer tastes and income are among the factors that determine their willingness and ability to pay for products and services are known as
total revenue
equal to the unit price for a product times the quantity of it sold
demand-oriented
factors underlying customer tastes and preferences are weighed most heavily
costs that do not fluctuate when production changes
fixed costs are
discrimination
if a firm sells the same product to different buyers at different prices, it may be guilty of price _____
at-market
if an organization sets prices similar to those of major competitors, it is using _____ pricing
negative
if total cost is greater than total revenue, then profit is
maximum units sold
on a demand curve, one of the axes represents the price of a product while the other represents the
elasticity
price _____ of demand is a measure of how sensitive consumer demand and the firm's revenues are to changes in the product's price
deceptive pricing
price deals that mislead consumers fall into the category of ____ pricing
cost-oriented
price is set by looking at the production and marketing costs, and then adding enough to cover direct expenses, overhead, and profit
competition-oriented
price setter stresses what "the market" is doing is determining a price
price
profit = (unit ____ x quantity sold) - (fixed cost + variable cost)
target return pricing target profit pricing
profit-oriented approaches to setting a price?
example of list price
published tuition
quantity
reductions in unit costs for a larger order are known as _____ discounts
example of extra fees
room and board, activity fees
example of incentive or allowance
scholarship or financial aid
discourages competitors potential to gain market share production costs drop with increased volume
select all of the following that are benefits of a penetration pricing strategy
target return maximizing current profits
strategies that can be used as part of a firm's profit objectives include which two of the following?
break-even
the ______-_____ point is the quantity at which total revenue and total cost are equal
constraints
the demand for a products class, a product, or a brand, or the newness of a product can act as pricing_____ to limit a firm's options
reward wholesalers and retailers for marketing functions
the firms goal in offering a trade discount is to
consumers' access to pricing information from many competitors and companies' ability to change prices frequently
the internet has resulted in which two things that affect the competitive environment for pricing?
bundle
the marketing of two or more products in a single package price
price
the money or other consideration (including other products and services) exchanged for the ownership or use of a product is known as
profit-oriented
the price setter balances both revenues and costs to set a price
attract customers that will hopefully buy other products too, at higher margins
the purpose of using low prices in a loss-leader pricing strategy is to
value
the ratio of perceived benefits to price is a product's _______
decreased profits
the social responsibility pricing objective often results in
seasonal discounts
to encourage buyers to stock inventory earlier than their demand would require
quantity discounts
to encourage customers to place larger orders
cash discounts
to encourage retailers to pay their bill quickly
trade discounts
to reward channel members for future marketing efforts
fixed cost and variable cost
total cost is the sum of what?
change with
variable costs ____ production volume
skimming pricing
when a firm introduces an innovative new product, it may choose ______ pricing, setting the highest initial price that customers who really desire the product are willing to pay
predatory
when using ____ pricing, a firm sets a very low price for one or more of its products with the specific intent to drive its competition out of business
what "the market" is doing
when using competition-oriented pricing approaches, price setters stress
what will pay for all associated costs, including marketing? What are customers willing to pay? What will provide a profit to the company?
which of the following are essential to consider when setting a price?
flexible-price one-price
which two of the following are the options when choosing a price policy?
prestige pricing
with _____ pricing, the marketer must not drop the price of a product below the point where customers become skeptical of its quality and refuse to purchase it
a complex approach that continually matches demand and supply to customize the price for a service
yield management pricing is