Ch 39 - Key term

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  • Created by: angus f.v
  • Created on: 12-12-14 14:24
Competition-based pricing
Pricing strategies based on the prices charged by rivals
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Cost plus or cost-based pricing
Adding a percentage (the mark-up) to the costs of producing a product to get the price
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Destroyer or predatory prices
Setting a low price until rivals have gone out of business
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Loss leader
A product sold below cost to draw in customers
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Market orientated pricing
Pricing strategies based upon the conditions in the market
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Mark-up
The percentage added the costs which makes a profit for a business when setting the price
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Penetration pricing
Setting a low price to start with in order to get established in the market. Price may be raised once established
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Price elasticity of demand
Measures the responsiveness of demand to a change in price
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Price elastic demand
Where a price change will result in a significant change in demand
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Price inelastic demand
Where a price change will result in a much smaller change in demand
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Skimming or creaming
Setting a high price initially and then lowering it later
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Other cards in this set

Card 2

Front

Adding a percentage (the mark-up) to the costs of producing a product to get the price

Back

Cost plus or cost-based pricing

Card 3

Front

Setting a low price until rivals have gone out of business

Back

Preview of the back of card 3

Card 4

Front

A product sold below cost to draw in customers

Back

Preview of the back of card 4

Card 5

Front

Pricing strategies based upon the conditions in the market

Back

Preview of the back of card 5
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