Mar-3023 Lecture Notes - Lecture 20: Grocery Store, Fixed Cost, Marginal Revenue
Document Summary
Price: the value paid for a product in a marketing exchange, not always money, tuition, premium, fine, fee, fare, toll, rent, tips, deposit, dues, taxes. Elasticity determinants: availability of substitutes, electricity vs. coca-cola, percentage of income, gum vs. a car, necessity, time, eventually find a substitute/quick smoking/die, brand loyalty. Produced: average total cost= avg vc + avg fc, total costs: sum of average fixed costs and average variable costs times the quantity produced. Reference price: the price stored in memory that helps to evaluate the actual price, serves as an anchor, frames the purchase price. Internal reference price: de(cid:448)elops i(cid:374) (cid:271)u(cid:455)e(cid:396)"s (cid:373)i(cid:374)d th(cid:396)ough e(cid:454)pe(cid:396)ie(cid:374)(cid:272)e (cid:449)ith p(cid:396)odu(cid:272)t, external reference price, a comparison price provided by others. Price strategies: framing: price framing, anchoring price for consumers, (cid:862)m rp(cid:863), co(cid:373)petito(cid:396)"s p(cid:396)i(cid:272)e, (cid:862)you a(cid:448)e(cid:863) Price strategies: bundling: offe(cid:396)i(cid:374)g se(cid:448)e(cid:396)al p(cid:396)odu(cid:272)ts fo(cid:396) sale i(cid:374) o(cid:374)e (cid:862)pa(cid:272)kage(cid:863, cable, phone, high speed internet, microsoft office, unbundling- charging separately for previously bundled products/services.
