CHP 13

Question 1

Price

Answer 1

money or other considerations (including other p/s) exchanged for the ownership or use of a p/s

Question 2

Barter

Answer 2

-practice of exchanging p/s for other products and services rather than for money

Question 3

Barter transactions

Answer 3

-account for billions of dollars annually in domestic and international trade
-about 12-14 billion dollars in US

Question 4

Price Equation

Answer 4

Price=List price-Incentives and Allowances+Extra Fees

Question 5

Value

Answer 5

=Perceived Benefits/Price

Question 6

Relationship between price and value

Answer 6

-for a given price, as perceived benefits increases, value increases

Question 7

Value Pricing

Answer 7

-practice of simultaneously increasing p/s benefits while maintaining or decreasing price

Question 8

Reference value

Answer 8

-process of comparing the costs and benefits of subsititute items

Question 9

Profit

Answer 9

=total revenue-total cost

Question 10

6 steps of setting price

Answer 10

1. Identifying pricing objectives and constraints
2. estimate demand and revenue
3. determine cost, volume, and profit relationships
4. select an approximate price level
5. set list or quoted price
6. make special adjustments to list or quoted price