APUYAN, ANGEL B.

| BSBA-2C | COSTING AND PRICING

Exercise 1.

1. Demand – Price theory is linked to demand. The term “demand" refers to the desire of the
market or the customer. To buy, to obtain, or acquire items and services for which they are
willing to pay a set price of a specific product or service.
2. Moon Prices – The prospect theory is linked to moon pricing. One way to seek or attract people
is to use moon pricing. Customers are attracted to their products because they give discounts
and rebates. Customers that might be interested will purchase an item knowing that he or she
would spend less money than expected price.
3. Equilibrium – Price theory is linked to equilibrium. You can think of equilibrium as a state of
balance or stability. When you are calm and stable, you have reached equilibrium. It’s a pricing
point that’s attractive. Allows supply to serve its customers in a reasonable manner.
4. Supply – The pricing theory is linked to supply. The quantity or amount of a specific commodity
is referred to as supply or product or service that the market can offer that is available to
customers. It is the accessibility to the goods or services that the market offers to customers.
5. Free or Paid – The prospect theory is linked to whether something is free or not. From the word
“free" itself, whether anything is free or bought, you did not pay for it, despite the fact that the
word “paid" implies that you did. It just demonstrates how will you appreciate something if it is
given to you for free in comparison to how you will value something you have to pay or paid for
in full.
6. Better to Pay in Cash – The prospect theory suggests that it is preferable to pay in cash. It is
more motivating to pay in cash rather than a credit or debit card because it will almost certainly
incur interest . Add to the initial price of the product you purchased.

Exercise 2.

1. Bundle Pricing – Bundle pricing is a marketing strategy that involves bundling various products
in order to persuade buyers to spend less money on the bundle than on the individual products.
Knowing they will buy more bundles than predicted because they have a discount for buying a
bundle.
2. Break-even Pricing – The point at which you make a profit or lose money isa called break-even
pricing. It’s the moment at which your expenses match your earnings. In other words, you didn’t
make any money, but you also didn’t lose any.
3. Mark-up Pricing – Mark-up pricing entails adding a percentage to a product’s cost in order to
determine its potential selling price. As a result, the mark-up is the sum of a product’s and
services price plus a percentage of it. This will determine how much profit you will make on each
product or service.
4. Pricing at a Premium – Pricing at a premium is a strategy used by the corporation when there
are competitors for the same product. Pricing your product pricier than your competitors is also
a means of persuading purchasers that your product have a superior quality.