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Chapter 11: Pricing products and services. When you finish this chapter, you should: Describe the nature and importance of pricing and the approaches used to select an approximate price level; explain what a demand curve is and the role of revenues in pricing decisions; explain the role of costs in pricing decisions and describe how various combinations of price, fixed cost, and unit variable cost affect a firm’s breakeven point. | McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 11, YOU SHOULD BE ABLE TO: LO1 Describe the nature and importance of pricing and the approaches used to select an approximate price level. Explain what a demand curve is and the role of revenues in pricing decisions. LO3 LO2 Explain the role of costs in pricing decisions and describe how various combinations of price, fixed cost, and unit variable cost affect a firm’s breakeven point. 11- LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 11, YOU SHOULD BE ABLE TO: Recognize the objectives a firm has in setting prices and the constraints that restrict the range of prices a firm can charge. Describe the steps taken in setting a final price. LO4 LO5 11- VIZIO, INC.—WHERE VISION MEETS VALUE™ IN HDTV 11- NATURE AND IMPORTANCE OF PRICE WHAT IS A PRICE?: THE PRICE EQUATION LO1 Price Barter Price Equation Veyron vs. Euro- FighterDrag Race 11- FIGURE 11-1 The “price” a buyer pays can take different names depending on what is purchased 11- NATURE AND IMPORTANCE OF PRICE PRICE AS AN INDICATOR OF VALUE LO1 Value = $ $ Profit Equation 11- FIGURE 11-2 Four approaches for selecting an approximate price level 11- GENERAL PRICING APPROACHES DEMAND-ORIENTED PRICING APPROACHES LO1 Skimming Pricing Penetration Pricing Prestige Pricing Odd-Even Pricing $500.00 vs. $499.99 11- MARKETING MATTERS Energizer’s Lesson in Price Perception— Value Lies in the Eye of the Beholder LO1 11- GENERAL PRICING APPROACHES DEMAND-ORIENTED PRICING APPROACHES LO1 Bundle Pricing Yield Management Pricing Target Pricing 11- GENERAL PRICING APPROACHES COST-ORIENTED PRICING APPROACHES LO1 Standard Markup Pricing Cost Selling Price 11- FIGURE 11-A Markups for a manufacturer, wholesaler, and retailer on a home appliance sold to consumers for $100 11- GENERAL PRICING APPROACHES COST-ORIENTED PRICING . | McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 11, YOU SHOULD BE ABLE TO: LO1 Describe the nature and importance of pricing and the approaches used to select an approximate price level. Explain what a demand curve is and the role of revenues in pricing decisions. LO3 LO2 Explain the role of costs in pricing decisions and describe how various combinations of price, fixed cost, and unit variable cost affect a firm’s breakeven point. 11- LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 11, YOU SHOULD BE ABLE TO: Recognize the objectives a firm has in setting prices and the constraints that restrict the range of prices a firm can charge. Describe the steps taken in setting a final price. LO4 LO5 11- VIZIO, INC.—WHERE VISION MEETS VALUE™ IN HDTV 11- NATURE AND IMPORTANCE OF PRICE WHAT IS A PRICE?: THE PRICE EQUATION LO1 Price Barter Price Equation Veyron .
