At least 2 pages long Marilyn Lysohir, an internationally celebrated ceramic artist, started Cowgirl Chocolates to provide some funding support for a yearly published arts magazine, High Ground, that she and her husband, Ross Coates, started in 1995. Her love of chocolates and hot and spicy foods spurred the idea of making hot and spicy chocolates to be sold in creative, artistic tins and packaging, which she labeled Cowgirl Chocolates. Her small business, begun in 1997, had won a number of awards in fiery food competitions. While Cowgirl Chocolates had grown steadily over its four years in business, it still had only generated $30,000 in sales revenue in 2000, which was not enough to cover expenses. Marilyn had drained much of her personal savings to keep Cowgirl Chocolates in business. Her cash accounting methods and record keeping were not very sophisticated although she seemed to have a good sense of her costs in production and raw materials and the packaging. However, Marilyn had taken a shotgun approach to most of her marketing efforts and had tried a number of activities to increase product demand. She allowed herself to make one risky financial move each year in her pursuit of profitability and increased sales. She had just made her one risky move for year 2001: She had taken out a full-page ad in Chile Pepper magazine for $3,000. Questions 1. The suggested retail price and wholesale prices of Cowgirl Chocolates products are displayed in Exhibit 2 (p. 491) along with the product and packaging costs. Based on this information, discuss the relative merits of using a cost-based, demand-based, and competition-based pricing method. (50 points) 2. What are four (4) options that Cowgirl Chocolates may consider as far as pricing? What would you recommend? (50 points) .

1. At least 2 pages long
Marilyn Lysohir, an internationally celebrated ceramic artist,
started Cowgirl Chocolates to provide some funding support for
a yearly published arts magazine, High Ground, that she and her
husband, Ross Coates, started in 1995. Her love of chocolates
and hot and spicy foods spurred the idea of making hot and
spicy chocolates to be sold in creative, artistic tins and
packaging, which she labeled Cowgirl Chocolates. Her small
business, begun in 1997, had won a number of awards in fiery
food competitions. While Cowgirl Chocolates had grown
steadily over its four years in business, it still had only
generated $30,000 in sales revenue in 2000, which was not
enough to cover expenses. Marilyn had drained much of her
personal savings to keep Cowgirl Chocolates in business. Her
cash accounting methods and record keeping were not very
sophisticated although she seemed to have a good sense of her
costs in production and raw materials and the packaging.
However, Marilyn had taken a shotgun approach to most of her
marketing efforts and had tried a number of activities to
increase product demand. She allowed herself to make one risky
financial move each year in her pursuit of profitability and
increased sales. She had just made her one risky move for year
2001: She had taken out a full-page ad in Chile Pepper
magazine for $3,000.
Questions
1. The suggested retail price and wholesale prices of Cowgirl
Chocolates products are displayed in Exhibit 2 (p. 491) along
with the product and packaging costs. Based on this
information, discuss the relative merits of using a cost-based,
demand-based, and competition-based pricing method. (50
points)
2. What are four (4) options that Cowgirl Chocolates may
consider as far as pricing? What would you recommend? (50
points)