ALOK KUMAR
SECTION - C
Concept Of Microeconomic Helps
In Pricing The Product
What is Microeconomics
 Micro means small. Thus, micro economics analyses
individualistic behaviour. It studies an indivi...
What Is Price?
 price is the quantity of payment or compensation
given by one party to another in return for goods or
ser...
Pricing Strategies
Pricing strategies for products or Service encompass three
main ways to improve profits. These are that...
CONT…..
 Market-oriented pricing
Setting a price based upon analysis and research compiled
from the target market. This m...
Factors Affecting The Price Of The
Product
Demand & Supply
Supply and demand is an economic model of price determination in a
market. It concludes that in a competet...
When Demand Increase Or Decrease And Supply
Remain Same
 An increase in demand while holding supply constant will cause a...
When Supply Increase Or Decrease And Demand
Remain Same
 An increase in supply while holding demand constant will cause a...
Factor Pricing In Compitetive Market
Monopolistic Competitive Market
 There are many producers and many consumers in the ...
Oligopoly Competitive Market
 In this competitive Market firm are price setter rather than price
taker
 Barrier to entry...
Conclusion
Product – Cloth
 During Durgapuja and Diwali time and marriage ceremony,
demand is more than supply so high pr...
http://www.unitedworld.edu.in/
Campus
Ahmedabad Campus: Karnavati Knowledge
Village, A/907,Uvarsad, S.G.Highway,
Gandhina...
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Concept Of Microeconomic Helps In Pricing The Product

  1. 1. ALOK KUMAR SECTION - C Concept Of Microeconomic Helps In Pricing The Product
  2. 2. What is Microeconomics  Micro means small. Thus, micro economics analyses individualistic behaviour. It studies an individual consumer, producer, price of a particular commodity, household, etc.  According to Prof. K. E. Boulding, "Micro Economics is the study of particular firm, particular household, individual prices, wages, incomes, individual industries and particular commodities."
  3. 3. What Is Price?  price is the quantity of payment or compensation given by one party to another in return for goods or services.  Economists sometimes define price more generally as the ratio of the quantities of goods that are exchanged for each other.
  4. 4. Pricing Strategies Pricing strategies for products or Service encompass three main ways to improve profits. These are that the business owner can cut costs or sell more, or find more profit with a better pricing strategy.  Cost-plus pricing It is the simplest pricing method. The firm calculates the cost of producing the product and adds on a percentage (profit) to that price to give the selling price.  Creaming or skimming In most skimming, goods are sold at higher prices so that fewer sales are needed to break even. Selling a product at a high price, sacrificing high sales to gain a high profit is therefore "skimming" the market.
  5. 5. CONT…..  Market-oriented pricing Setting a price based upon analysis and research compiled from the target market. This means that marketers will set prices depending on the results from the research.  Penetration pricing Setting the price low in order to attract customers and gain market share. The price will be raised later once this market share is gained.  Premium pricing Premium pricing is the practice of keeping the price of a product or service artificially high in order to encourage favorable perceptions among buyers, based solely on the price.
  6. 6. Factors Affecting The Price Of The Product
  7. 7. Demand & Supply Supply and demand is an economic model of price determination in a market. It concludes that in a competetive market, the unit price for a particular good will vary until it settles at a point where the quantity demanded by consumers (at current price) will equal the quantity supplied by producers (at current price), resulting in an economic equilibrium of price and quantity.
  8. 8. When Demand Increase Or Decrease And Supply Remain Same  An increase in demand while holding supply constant will cause a price increase.  A decrease in demand while holding supply constant will cause a price decrease.  In this case, the increase in demand caused price to rise from P1 to P2.
  9. 9. When Supply Increase Or Decrease And Demand Remain Same  An increase in supply while holding demand constant will cause a price decrease.  A decrease in supply while holding demand constant will cause a price increase.  In this case, the increase in supply caused the price to fall from P1 to P2.
  10. 10. Factor Pricing In Compitetive Market Monopolistic Competitive Market  There are many producers and many consumers in the market, and no business has total control over the market price.  Consumers perceive that there are non-price differences among the competitors' products.  There are few barriers to entry and exit.  Producers have a degree of control over price.
  11. 11. Oligopoly Competitive Market  In this competitive Market firm are price setter rather than price taker  Barrier to entry in this firm is high  Oligopolies can retain long run abnormal profits. High barriers of entry prevent sideline firms from entering market to capture excess profits  Oligopolies tend to compete on terms other than price. Loyalty schemes, advertisement, and product differentiation are all examples of non-price competition Cont….
  12. 12. Conclusion Product – Cloth  During Durgapuja and Diwali time and marriage ceremony, demand is more than supply so high price is charge for cloth  During other than this session, the demand is less than supply so less price is charge by allowing discount in the price of the cloth  In monopolistic competitive market, the firm can’t charge high price but little more than competitors price because of brand value  In oligopoly competitive market, due to less seller and more buyer, the firm set the price of in own choice but up to certain limit because high price is result to loose the customer
  13. 13. http://www.unitedworld.edu.in/ Campus Ahmedabad Campus: Karnavati Knowledge Village, A/907,Uvarsad, S.G.Highway, Gandhinagar Kolkata Campus: Infinity Benchmark Tower 10th Floor, Plot - G1, Block - EP& GP, Sec - V, Salt Lake, Kolkata. Reg. Office: 407, Zodiac Square, 4th Floor Opp. Gurudwara, S.G. Road, Bodakdev, Ahmedabad.

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