Marketing Essentials

Section 2: Factors Involved in Price Planning

After You Read Online Action

Key Terms and Concepts

1. Options might include: pass the costs to their customers; reduce the size of the item to keep the same price; drop some features their customers do not value; add more features or upgrade the materials to justify a higher price.
2. The five factors that affect demand elasticity are brand loyalty, price relative to income, availability or substitutes, luxury versus necessity, and urgency of purchase.
3. Federal Trade Commission (FTC)

Academic Skills

4. The break-even point is 160,000 CDs; 200,000 X $12 = $2,400,000 ÷ $15 = 160,000
5. The three forms of discrimination the Robinson-Patman Act prevents are: price, discount, and other preferential treatment if they lessen competition or hurt individual competitors.