Chapter 16 Pricing Strategies: Basic Decisions. Chapter Outline The Role of Price Price Standardization.

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Presentation transcript:

Chapter 16 Pricing Strategies: Basic Decisions

Chapter Outline The Role of Price Price Standardization

Chapter Outline Pricing Decisions -Supply and Demand -Cost -Elasticity and Cross Elasticity of Demand -Exchange Rate -Market Share -Tariffs and Distribution Costs -Culture

Chapter Outline Alternative Pricing Strategies Dumping -Types of Dumping -Legal Aspect of Dumping -How to Dump (Legally and Illegally) Price Distortion Inflation Transfer Pricing

Pricing Decisions Supply and Demand Cost Elasticity and Cross Elasticity of Demand Exchange Rate Market Share Tariffs and Distribution Costs Culture

Dumping charging different prices for the same product in similar markets unfair price – below production cost – below home-country price harm to host-country companies

Transfer Pricing prices used by the parent firm and subsidiaries when trading among themselves Transfer Pricing Methods direct manufacturing costs direct manufacturing costs plus markup market-based transfer price arm's length price

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