Pricing
Objectives
Prices and
Revenue
Psychological
Pricing
Discount
Pricing
Calculate
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Offering the lowest price
possible to get the largest
number of customers to
buy is what strategy?
Category 1 – 10 Points
Maximize sales
Charging the highest price
that customers will pay is
which pricing strategy?
Category 1 – 20 Points
Maximize Profit
Profit
Investment
Equals __________.
Category 1 – 30 Points
ROI (Return on Investment)
A company sets its prices
in relationship to the
prices charged by the
other similar stores
Category 1 – 40 Points
Meet competition
The goal of the business is
to increase the
percentage of the total
sales of a specific product
Category 1 – 50 Points
Increase market share
As prices increase,
revenues _________
Category 2 – 10 Points
Increase
As costs go down,
revenues ____________
Category 2 – 20 Points
Increase
Revenue equals the
number of items sold
________ the _________
Category 2 – 30 Points
Times; price
As the price of an item
goes down, what happens
Category 2 – 40 Points
More items are usually sold
You want to increase
revenue in your business.
Give at least two options
you could try.
Category 2 – 50 Points
Decrease the costs; lower the price
to sell more; raise the price to
increase profits
Prices ending like $5.99,
$89.95, and $39,999
Category 3 – 10 Points
Odd pricing
Prices are lowered for
running sales: dollars off,
percent reductions,
rebates, coupons, and
BOGO
Category 3 – 20 Points
Promotional pricing
Prices are set high to
convey an image of status
and high quality
Category 3 – 30 Points
Prestige pricing
Displaying the price of an
item based on a standard
unit of measure
Category 3 – 40 Points
Unit pricing
Prices are set at different
levels to indicate different
quality levels for the same
type of product
Category 3 – 50 Points
Price lining
Retailers buy goods in
advance of the season,
they may get this discount
Category 4 – 10 Points
Seasonal discount
A reduction in price
offered for purchasing a
large number of a product
Category 4 – 20 Points
Quantity discount
A discount given for
paying their bills promptly
Category 4 – 30 Points
Cash discount
Product advertised in an
ad that is going to be
discounted
Category 4 – 40 Points
Promotional discount
Give the precise defintion
for the following: 1/15, n45
Category 4 – 50 Points
1% discount if paid in 15 days, net
due in 45 days
Calculate the ROI for:
Investment = $50,000
Profit = $5,000
Category 5 – 10 Points
10%
An item costs $2.50 each
and we want to make a
profit of $.69. What will
we price the item
Category 5 – 20 Points
$3.19
A product costs $41.20
and has 25% markup.
What is the retail price?
Category 5 – 30 Points
$51.50
The list price is $208.75.
We get a Trade Discount
of 18%.
How much is our
discount?
What is the net price?
Category 5 – 40 Points
$37.58; $171.17
Cost per
item
$144.50
# of items Selling
purchased Price
300
$225.00
Category 5 – 50 Points
193