MGMT 3600 Chapter 11 Pricing Products and Services
cost is the sum of the expenses of the firm that are stable and do not change with the quantity of a product that is produced and sold. (Enter one word in the blank)
Fixed
What element of the marketing mix has a unique role in that it is the place where all other business decisions come together?
Price
Four approaches used to set ______ are oriented around demand, cost, profit, and competition.
approximate price levels
The chart that shows how many units of a product or service consumers will demand during a specific period of time at different prices is known as the Blank______.
demand curve
Cost-oriented approaches to pricing consider which three things in the setting of a product's price?
production costs overhead profit
The relationship, or ratio, between a product's perceived benefits and the consumer's costs is known as its ______.
value
The money or other considerations exchanged for the ownership or use of a product or service is its
Price
Total is equal to the unit price for a product times the quantity of it sold. (Enter one word in the
Revenue
A one-price policy means there is one price for ______.
all buyers of the product
Demand-oriented, cost-oriented, profit-oriented, and competition-oriented are four approaches used to set Blank______.
approximate price levels
Demand-oriented, cost-oriented, profit-oriented, and competition-oriented are four approaches used to set ______.
approximate price levels
Break-even analysis analyzes the relationship between total revenue and total cost to determine profitability ______.
at various levels of output
Small changes in price Blank______.
can have comparably big effects on company profit
Common approaches to pricing are oriented around which four elements?
competition demand profit cost
If firms set prices with specific consideration of firms challenging them directly for customers, they have adopted a ________ approach to pricing.
competition-oriented
If firms set prices with specific consideration of firms challenging them directly for customers, they have adopted a ________ approach to pricing.
competition-oriented Need help? Review these concep
Select all of the following that are common approaches to setting an approximate price level for a product.
competition-oriented cost-oriented demand-oriented
Legal and regulatory issues and consumer demand are pricing ________ that limit what a company can charge for its products.
constraints
The demand for a product class, a product, or a brand, or the newness of a product can act as pricing ________ to limit a firm's options.
constraints
Pricing approaches that consider the production and marketing costs and then add enough to cover direct expenses, overhead, and profit are known as ______ approaches.
cost-oriented
Organizations choosing competitor-oriented approaches to set prices might use which two pricing strategies?
customary pricing loss-leader pricing
Demand-oriented pricing approaches weigh which factors most heavily?
expected customer tastes and preferences
A demand curve enables a firm to examine prices Blank______.
in terms of quantity sold
Pricing objectives involves specifying the role of price in what two areas of an organization?
its strategic plans its marketing plans
A marketing manager considers pricing objectives and constraints to ______.
narrow the range of choices among the variety of pricing strategies
Pricing ________ involve specifying the role of price in an organization's marketing and strategic plans.
objectives
Pricing ________ frequently reflect corporate goals, while pricing ________ often relate to conditions existing in the marketplace.
objectives; constraints
A ________ policy is also known as fixed pricing.
one price
Setting a price with no variation for product buyers is called a ________ policy.
one-price
Demand
oriented approaches to pricing regard expected customer tastes and preferences as the most important factors in the decision.
Value is defined as ______.
perceived benefits divided by price
The money or other consideration (including other products and services) exchanged for the ownership or use of a product is known as ______.
price
The percentage change in quantity demanded relative to a percentage change in price is known as ______.
price elasticity of demand
By focusing on target profit pricing or target return pricing, a firm is using a ________ pricing approach.
profit-oriented
Price elasticity of demand is expressed as percentage change in ________ divided by the percentage change in ________.
quantity demanded; price
Customers are encouraged to buy a larger number of a single product when a firm offers ______.
quantity discounts
Which of the following are reductions in unit costs for a large order?
quantity discounts
Fixed costs
remain at the same level despite changes in production
Which two are profit-oriented approaches to setting a price?
target return pricing target profit pricing
Unit price times quantity sold is ______.
total revenue
Break-even analysis analyzes the relationship between which two at various levels of output?
total revenue total cost
According to the profit equation, profit is ______.
total revenue minus total cost
Profit = (____ x quantity sold) - (fixed cost + variable cost)
unit price