BUAD 332 Exam 3 UTK Questions and Answers 2024

Price - Correct Answer -Narrowly: price is the amount of money charged for a product -Broadly: price is the sum of all values consumers exchange for a product/service Price is ____not just money - Correct Answer -Sacrifice -Ex: ordering from Amazon vs Dillards to order from Amazon you sacrifice time and ability to try on to order from Dillards you sacrifice gas, time, selection, convenience, etc. Factors affecting price - Correct Answer Internal -marketing objectives -marketing strategies -costs External -nature of market and demand -competition -economy, gov, resellers, social concerns Marketing Objectives - Correct Answer -survival -current profit maximization -market share leadership -product quality leadership Survival - Correct Answer -Low prices on products to quickly increase demand -Ex: Amazon at beginning to build volume, they had high fixed costs Current Profit Maximization - Correct Answer choose the price that produces the maximum current profit Market Share Leadership - Correct Answer -low as possible prices to become the market share leader -Ex: Walmart Product Quality Leadership - Correct Answer -high prices to cover higher performance quality and R&D -Ex: Mercedes Benz -Ex: Pharmaceuticals- $1000000 for the first pill and $50 for the rest Internal Factors that Affect Price - Correct Answer -Fixed cost -overhead cost -variable cost (always a bad idea to price below variable cost) -raw materials