pricing methods

Question 1

what is RRP?

Answer 1

recommended retailed price: Selling price that is recommended by the manufacturer or wholesaler.

Question 2

competitors pricing?

Answer 2

prices charged by competitors.

Question 3

market reaction?

Answer 3

Response of customers in the market to price levels for a particular good or service.

Question 4

quotes?

Answer 4

determining a selling price by estimating the costs involved with a particular job, and then adding on a certain amount to provide for profit.

Question 5

quotes what is included?

Answer 5

Cost of labour
Cost of materials
Desired profit

Question 6

mark-up?

Answer 6

Determining selling prices by adding to the cost price a predetermined profit margin.

Question 7

cost volume profit analysis

Answer 7

An analysis tool that allows a business to determine a selling price or volume of sales that will let them achieve a specific profit goal(can be used to find break even point)

Question 8

break even point

Answer 8

total revenue = total expenses and the business neither makes a profit or a loss.

Question 9

Variable Costs

Answer 9

those that vary directly in relation to the volume of sales. expressed as cost per unit. Examples, cost of inputs.

Question 10

Fixed Costs

Answer 10

those that remain the same regardless of the volume of sales. Fixed cost examples include rent, insurance, wages.