Class Intro 17
Price Setting in the Business World
Cost Oriented Pricing
Use of Mark Ups: Wholesalers and Retailers
Average Cost Pricing
Types of Costs: Fixed Costs; Sunk Costs; Variable Costs; Total Costs; Average Costs; Average Fixed Costs; Average Varibale Costs
Contribution margin: contribution per unit
Break-even Analysis: by units, by revenue; determining price
At what volume of sales does a the product "break even", at different price points.
Book example. Use final price, price to retailer ? Fixed costs include opportunity costs ?
Total revenue and total cost curves.
Demand Oriented Pricing
Value in Use; Auctions; Sequential Reductions; Reference; Leader & Bait; Zero ?
Why price a product at zero ?
Psychological; Odd-Even; Price Lining; Demand Backward; Prestige
Full Line Pricing: Market Oriented and Firm Oriented; Cost assignment; Complementary Product Pricing