Concept explainers
a)
Case summary:
Company WG manufactures 4 categories of instruments such as batch custom, mass produced, one-of-a-kind, and mass customized. It is necessary to set different prices to different categories of instruments to sustain in the business. Person BA, who is the vice president of Company WG, is responsible for setting the price.
The recommended retail cost is $349. Person BA calculates Company WG variable and fixed costs to know the breakeven point and profit. Profits and breakeven points are calculated under different conditions to assess the effects of production facility.
Characters in case:
Company WG
Person BA
Introduction:
Break-even point analysis is used to show the relationship between the total cost and total revenue to determine profits at several stages of output. The break-even point occurs when the total cost and total revenue are equal.
To determine: The breakeven point at $349.
b)
Case summary:
Company WG manufactures 4 categories of instruments such as batch custom, mass produced, one-of-a-kind, and mass customized. It is necessary to set different prices to different categories of instruments to sustain in the business. Person BA, who is the vice president of Company WG, is responsible for setting the price.
The recommended retail cost is $349. Person BA calculates Company WG variable and fixed costs to know the breakeven point and profit. Profits and breakeven points are calculated under different conditions to assess the effects of production facility.
Characters in case:
Company WG
Person BA
Introduction:
Profit is a gain from the business to an organisation. The gain for the organisation comes from the business activities that exceed the costs, taxes, and expenses.
To determine: The profit, if it sells 2,000 units.
Want to see the full answer?
Check out a sample textbook solutionChapter 13 Solutions
Connect 1-Semester Access Card for Marketing
- Gillette’s pricing scheme is to sell razor handles at a relatively low price and razor blades at a relatively high price. This practice is known as: Group of answer choices predation. retail maintenance. leverage. tying.arrow_forwardBeing at the premium end is category upon itself. Describe the indicator of premiumness or high quality and high price that can apply to most types of productsarrow_forwarddeveloped a new weight-loss breakfast Shake that has proven to be successful in the test market phase. Users have experienced an average weight loss of two pounds per week. You hold a patent on the product. The cost to produce the shake is relatively low, with total manufacturing costs running about $0.05 per ounce. Each shake is eight ounces. What pricing strategy do you recommend for this product?arrow_forward
- Being at the premium end is a category upon itself.Describe the indicators of premiumness or high quality andhigh price that can apply to most types of products.arrow_forwardCritical Thinking Some retailers have used decoy pric- ing to increase the number of sales of a higher priced alternative. Describe decoy pricing. What are some products that would be good choices for decoy pric- ing? Is this practice ethical? Why or why not?arrow_forwardList the general approaches to pricing. Select examples of products that you regularly use. i. Notice the price of each of these items For each item, ii. State the main benefits you are looking for in using the product. iii. Does the price communicate the total benefits sought? iv. Does the product’s price suggest good value? v. Do you think the manufacturer or retailer is overcharging or undercharging consumers for the product?arrow_forward
- Explain how a brand of a commonly purchased consumer packaged goods, such as toilet tissue, could be skim-priced? A service provider has decided to charge his customers P5, 000 for every upholstery cleaning service. The customer thinks that it is a steal , since the service provider is doing a great job and thinks that it could have costed them at least P7, 000 had they agreed to the first service provider that they went to. The total cost to the provider is P2, 000 which include the cleaning materials and labor. Identify the ceiling price and floor price of the service. Should the service provider decide to increase his price to P6, 500, do you think it is still acceptable to the customer? Why? Give an example of a situation where a price that is low with respect to the product’s VTC would not serve as an incentive to buy. What would be the implications of this for the use of a penetration strategy for pricing his product? RESEARCH: What is a pioneer advantage? Describe…arrow_forwardTrade discounts for televisions that have list price of $250.00 are 15%, 10% and 8%. Find the billed cost for the television.arrow_forward1 What are some examples of bundle pricing? 2 What are some other examples of promotional pricing? 3 How does promotional pricing contribute to a business’s overall marketing strategy? Please number your responses for each question (1, 2, and 3)arrow_forward
- Consumers often consider price: Multiple Choice to suggest potential product use. to determine income requirement. to suggest product size. only when short on funds. to suggest product qualityarrow_forwardAdidas combines a bunch of products including sneakers, socks, and sportswear and sets a price for this bundle which is lower than the sum of individual prices of products, this is an example of product-bundle pricing. Select one: O a. False O b. True Starbucks delivers an advertisement in which their traditional Americano Coffee is under the spots, This is an example of reminder advertising. Select one: O a. True Ob. False Next page agearrow_forward1. What are some examples of bundle pricing? 2. What are some other examples of promotional pricing? 3. How does promotional pricing contribute to a business's overall marketing strategy? Please number your responses for each question (1, 2, and 3)arrow_forward
- Principles Of MarketingMarketingISBN:9780134492513Author:Kotler, Philip, Armstrong, Gary (gary M.)Publisher:Pearson Higher Education,MarketingMarketingISBN:9781259924040Author:Roger A. Kerin, Steven W. HartleyPublisher:McGraw-Hill EducationFoundations of Business (MindTap Course List)MarketingISBN:9781337386920Author:William M. Pride, Robert J. Hughes, Jack R. KapoorPublisher:Cengage Learning
- Marketing: An Introduction (13th Edition)MarketingISBN:9780134149530Author:Gary Armstrong, Philip KotlerPublisher:PEARSONContemporary MarketingMarketingISBN:9780357033777Author:Louis E. Boone, David L. KurtzPublisher:Cengage Learning