group 3

• BREAK-EVEN PRICE

  refers to the price that will produce enough revenue to cover all cost at a given level of production. at the break-even point, there is neither profit nor loss.
• FIXED COST

  expenses that remain constant regardless of the level of production or sales volume.
• VARIABLE COST

  expenses that change proportionately with the level of production or sales volume
• Break-Even Equation

  pn=Vn+FC

  p=price

  n=number of unit sold

  V=variable cost per unit

  FC=fixed cost
• CACULATING BREAK-EVEN PRICE

  p=(Vn+FC)/n
• CALCULATING BREAK EVEN QUANTITY

  n=FC/(p-V)
• PROFIT ORIENTATION

  is a pricing strategy or approach wherein the primary focus is an maximizing profits for the business.
• CUSTOMER-ORIENTED PRICING APPROACH

  allows you to treat the break-even data as one input to your pricing, but it goes beyond that to bring your customers' perceptions and the full value of your product into the pricing evaluation.