ITB: 2-7 Pricing Considerations and Analysis

Front

What is the goal of pricing?

Back

To create optimum value for both the seller and buyer

Front

What is the market price?

Back

The price determined by supply and demand

Front

What is relative price?

Back

The price of a product compared to its competitors.

Front

What is the substitution effect?

Back

The change in demand of a product due to a change in its price

Front

What factors should be considered when setting the right price for a product?

Back

Value to customers, competitiveness, brand image, profit margin, and flexibility

Front

What is market share?

Back

The percentage of the Total Available Market a company makes sales to

Front

What is price elasticity?

Back

The degree to which the demand for a product changes based on changes in its price

Front

What is the purpose of a sales-oriented pricing strategy?

Back

To lower prices and gain market share

Front

What is the product life cycle?

Back

The stages a product goes through from introduction to decline

Front

What does price equilibrium refer to?

Back

The actual price where the quantity demanded equals the quantity supplied