What is a major challenge for marketers?
Finding a balance between what producers are willing to produce and what customers are willing to buy
Explain law of demand.
When the price goes up less people will buy it, vice verse
Explain law of supply.
When the price goes up the more products will be made, to even them out
Explain the equilibrium price diagram; be able to draw.
When the price rises the quantity will get higher.
What is the equilibrium.
When the supply and demand level out
How does price affect demand?
The higher the price, the less people will buy it so the demand is low
What is the governments involvement in free enterprise?
Has an influence on the price for products through antitrust laws & taxation
List ways competition can be beneficial to businesses.
They can get more ideas & encourages them to make new products
How is competition beneficial to consumers?
The get more options & better quality products
Tax reductions encourage production and sales. True or False:
Name the 3 illegal pricing strategies.
Price fixing, Bait & Switch, & price discrimination
Give an example of price fixing.
If has stations in Fayetteville came together and decided they were going to raise the gas prices
Give an example of Bait & switch.
If Sketchers advertises a sale and when you go to buy it, it is out of stock; but then they direct you to the more expensive Foot Locker
Give an example of price discrimination.
If someone was to charge someone that looked poor a higher price than someone that looked wealthy.
List 3 ways the government influences pricing.
Antitrust laws, taxation, & various consumer protection laws
What do you have to consider when pricing goods?
Cost of merchandise, operating expenses, & how much profit you want
Give examples of operating expenses.
Utilities, salaries, & feeder all income taxes
Give an example of price lines.
Foot Locker is the high end price line and champs would be the alternative
Give an example of psychological pricing.
Odd-even pricing; putting .99 instead of a full dollar amount
Give an example of prestige pricing.
Nike socks sold in Dicks will be more expensive than in Walmart because the have “better” quality
Give an example of promotional pricing.
Saying a deal like 3 for $3; if the predicts is only $1 and some, getting cheated
Give an example of loss-leader pricing.
Dicks putting college t-shirts on sale during March Madness
Name the 5 steps to determining the price to charge for a good or service.
Determine cost of product or service, Estimate customer demand, study the competition, & decide on pricing strategy
Be able to label and explain the business (economic) cycle.
Peak (top), contraction (down), trough (bottom), expansion (up)
How does inflation contribute to a recession.
If people don’t have jobs or money then they will not be buying as many products
Why must sports and entertainment marketers pay careful attention to cubs under trends?
So they do not lose profit
How do you determine the markup percentage?
Divide the markup by the original price.
What does GDP stand for?
Gross domestic product.