| A | B |
|---|
| Price | The value in money (or its equivalent) placed on a product. |
| Return on Investment | A calculation that is used to determine the relative profitability of a product. |
| Market Share | A company’s percentage of total sales volume generated by all competition in a given market. |
| Break-even Point | The point at which sales revenue equals the costs and expenses of making and distributing a product. |
| Demand Elasticity | The degree to which demand for a product is affected by its price. |
| Law of Diminishing Marginal Utility | An economic law stating that consumers will buy only so much of a given product, even though the price is low. |
| Price Fixing | When competitors agree on certain price ranges within which they can set their own prices. |
| Price Discrimination | Charging different prices to similar customers in similar situations. |
| Unit Pricing | Including price information for a standard unit or measure so that consumers can compare prices more easily. |
| Loss Leader | An item priced at or below cost to draw customers into a store. |
| Markup Pricing | The process where resellers add a dollar amount (markup) to its cost to arrive at a price. |
| Cost-plus Pricing | All costs and expenses are calculated, and then the desired profit is added to arrive at a price. |
| One-price Policy | All customers are charged the same price for the goods and services offered for sale. |
| Flexible-price Policy | A price policy that lets customers bargain for merchandise. |
| Skimming Pricing | A pricing policy that sets a very high price for a new product. |
| Penetration Pricing | A pricing policy that sets the initial price for a new product very low. |
| Product Mix Pricing Strategies | Adjusting prices to maximize the profitability for a group of products rather than just one item. |
| Price Lining | A special pricing technique that sets a limited number of prices for specific groups or lines of merchandise. |
| Bundle Pricing | A pricing technique in which a company offers several complementary products in a package that is sold at a single price. |
| Geographical Pricing | A pricing technique that makes price adjustments because of the location of a customer for delivery of products. |
| Segmented Pricing Strategy | A pricing strategy that uses two or more different prices for a product, even though there is no difference in the item’s cost. |
| Prestige Pricing | A pricing technique that sets higher-than-average prices to suggest status and high quality to the consumer. |
| Everyday Low Prices | Consistently low prices with no intention of raising them or offering discounts in the future. |
| Promotional Pricing | A pricing technique in which prices are reduced for a short period of time; generally used in conjunction with sales promotions. |
| Gross Profit | The difference between sales revenue and the cost of goods sold. |
| Maintained Markup | The difference between an item’s final sale price and its cost. |
| Employee Discounts | Discounts offered by employers to their workers. |
