COMMERCE 2MA3 Chapter 11: Chapter Eleven — Pricing
10 Feb 2017
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Document Summary
Pro t orientation: a company objective that can"t be implemented by focusing on target pro t pricing, maximizing pro ts, or target return pricing. Target pro t pricing: a pricing strategy implemented by rms when they have a particular pro t goal as their overriding concrete uses price to stimulate a certain level of sales at a certain pro t per unit. Maximizing pro ts strategy: a mathematical model that captures all the factors required to explain and predict sales and pro ts, which should be able to identify the price at which its pro ts are maximized. Sales orientation: a company objective based on the belief that increasing sales will help the rm more than will increasing pro ts. Competitor orientation: a company objective based on the premise that the rm should measure itself primarily against its competition. Competitive parity: a rm"s strategy of setting prices that are similar to those of major competitors.
