Objective 12-4 Identify the various pricing objectives that govern pricing decisions, and describe the price-setting tools used in making these decisions.
The second major component of the marketing mix is pricing, determining what the customer pays and the seller receives in exchange for a product. Setting prices involves understanding how they contribute to achieving the firm’s sales objectives. In order to learn more about how prices are determined, we will begin by discussing the objectives that influence a firm’s pricing decisions. Then we describe the major tools that companies use to meet those objectives.