1. GCSE Business Studies Unit 1 Starting a Business
Marketing Mix – Price

2. Images © thinkstockphotos.co.uk
Learning Outcomes
Explain and discuss pricing policies (skimming, penetration and competitor-based pricing)
Evaluate pricing policies for given circumstances
Analyse factors that affect price (demand, cost of production, need to make a profit, competition in the market, price that the market can bear, seasonality, quantity and inventory in hand)
Analyse simple demand curves to explain the relationship between price and demand
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3. Images © thinkstockphotos.co.uk
Price
Pricing Policies
Skimming
Competitor – based pricing
Penetration
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4. Factors that affect Price
Demand for the product
Cost of production
Need to make a profit
Competition in the market
Price that the market can bear
Seasonality (certain products may not be available at certain times of the year)
Quantity of inventory in hand (stock available)
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5. Relationship between Price and Demand
Demand is when consumers want a product and have the money to purchase it
Businesses want to know how much demand there will be for their products at different prices.
Demand for a product will be higher if the price is lower.
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6. Images © thinkstockphotos.co.uk
Price and Demand Curve
Price
Demand
ACTIVITY: (5 minutes)
Explain the relationship between price and demand.
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7. Exam Question and Check List
Past paper 2016 Unit 1
- Q4 (a) – spend approx. 2 minutes completing this question.
Q4 (b) – spend approx. 4 minutes completing this question.
Learning Check – Do you know . . .
1. About pricing policies?
2. The advantages and disadvantages of pricing policies for given circumstances?
What factors affect price?
How to analyse simple demand curves to explain the relationship between price and demand?
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