MKTG 341 Chapter Notes - Chapter 11: Price Equation, Unit Price, Fixed Cost
10 Dec 2014
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Price is the money or other considerations (including other products and services) exchanged for the ownership or use of a product or service. Barter: exchanging products and service for other products and services rather than money. Special fees and surcharges: this practice is driven by consumers zeal for low prices combined with the ease of making price comparison on the internet. Buyers are more willing to pay extra fees than a higher list price, so sellers use add- on charges as a way of having the consumer pay more without raising the list price. Price equation: final price = list price incentives + allowance + extra fees. Price is often used to indicate value when it is compared with the perceived benefits such as quality, durability, and so on of a product or service. Value: the ratio of perceived benefits to price or : value = perceived benefits / price.
