Pricing Metrics and Concepts

24 Pages Posted: 21 Oct 2008

See all articles by Paul Farris

Paul Farris

University of Virginia - Darden School of Business

Phillip E. Pfeifer

University of Virginia - Darden School of Business

Neil Bendle

University of Virginia - Darden School of Business

Abstract

This note describes the more common methods of calculating Price Premiums (also known as Relative Prices). Students will explore Reservations Prices and % Good Value, the concepts that form the foundation of price-quantity schedules, as well as Price Elasticity, a frequently used index of how responsive the market is to changes in price. The note stresses that understanding demand functions and Price Elasticity is key to the calculation of optimal prices and uses the familiar concept of Prisoner's Dilemma and addresses price tailoring.

Excerpt

UVA-M-0723

PRICING METRICS AND CONCEPTS

Price Premium 1

Benchmark Prices 2

Practical Issues with Price Premium 3

. . .

Keywords: pricing, marketing

Suggested Citation

Farris, Paul and Pfeifer, Phillip E. and Bendle, Neil, Pricing Metrics and Concepts. Darden Case No. UVA-M-0723. Available at SSRN: https://ssrn.com/abstract=910135

Paul Farris (Contact Author)

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States
434-924-0524 (Phone)

HOME PAGE: http://www.darden.virginia.edu/faculty/farris.htm

Phillip E. Pfeifer

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States
434-924-4803 (Phone)

HOME PAGE: http://www.darden.virginia.edu/faculty/Pfeifer.htm

Neil Bendle

University of Virginia - Darden School of Business

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

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