Managing Finance assignment 3 Essay Example | Topics and Well Written Essays - 2000 words

Managing Finance assignment 3 - turn out Example2. Penetration pricing- Penetration Pricing The system of setting a products price relatively minuscule in order to generate a high sales volume. The strategy is commonly associated with pricing new-made products that do not have identifiable price-market segments. It is employ to secure rapid penetration of a market. . This is the strategy use by many Chinese companies. It priced its products very much than its Western counterparts and it is making a soul way for a quite number of computer products.3. Profit Maximization - In economics, profit maximization is the process by which a firm determines the price and output level that recurrences the greatest profit.. Hence, based on the above concept. The strategy requires the price combinations that would yield the highest profit. Hence, a company can use this to have higher(prenominal) profits.Directly or indirectly this is used my many food business like Jollibee food chains. If atomic number 53 enters an outlet one would observe packaging their meals into different combinations of food items. Such strategy is profit maximization.4. competitor indexing. It is a price setting technique used by marketers. Generally, it involves using the price of competitors products in determine the price of your own products. Its main advantage is ease of use. Extensive marketing research and statistical abstract are not required 5. Target rate of return pricing- It is a pricing method used almost exclusively by market leaders or monopolists. You start with a rate of return objective, like 5% of invested capital, or 10% of sales revenue. Then you arrange your price structure so as to achieve these target rates of return.