unit 5.6 quizlet

Question 1

Price skimming

Answer 1

Setting a high price then lowering it over time

Question 2

Price penetration

Answer 2

Setting a low price then increasing it overtime

Question 3

Competitive pricing

Answer 3

Setting a price based on what similar businesses are doing

Question 4

Loss leader pricing

Answer 4

Not making a profit on certain products in order to sell complementary goods

Question 5

Price elasticity of demand

Answer 5

How much does demand change when there is change in price

Question 6

Cost plus pricing

Answer 6

Calculating the unit cost and adding % of profit on top

Question 7

Price elastic demand

Answer 7

Demand is very senstive to a change in price

Question 8

Price inelastic demand

Answer 8

Demand is not sensitive to a change in price

Question 9

Factors which influence prices

Answer 9

Cost, demand, elasticity, nature of the market, stage in the product life cycle, business objectives, strength of the brand, competitors pricing