Pricing

            Chapters 20 & 21

Chapter 20:  Concepts

                Inside the PC War

A.  Price vs Non-price competition (explain each)

B.  Analysis of Demand

                What is the demand curve?

                Explain Figure 20.2 (524 p)

                Explain Demand Fluxuations

                How do you determine the elasticity of a product?

C.  Cost

                Breakeven Analysis

D.  What are the Factors Affecting Pricing Decisions?

Jet Blue:  Profitability

Chapter 21:  Setting Prices

Family Dollar:  Everyday Low Prices

Stages for Establishing Prices (explain each)

                1.  Objectives (7 of ‘em)

                2.  Target Markets Evaluation of Price

                3.  Evaluation of Competitors’ Prices

                4.  Basis for Pricing Decision

                                Cost – Based

                                Demand – Based

                                Competition – Based

                5.  Selection of a Pricing Strategy

                                Differential Pricing

                                New-Product Pricing

                                Product-Line Pricing

                                Psychological Pricing

                                Professional Pricing

                                Promotional Pricing

                6.  The Specific Price

Cases:    VIPdesk.com

                Apple iMac

                Blockbuster