10 Questions
Which factor is the most important in determining the price of a product in the tourism and hospitality industry?
The cost of the product
What does the law of demand state?
The lower the price, the higher the demand
Which factor concerns the seller when determining the price of a product?
The cost of the product
What does the price range of a product depend on?
The demand for the product
Which factor affects price determination by considering the pricing strategies of other businesses in the market?
The price of competitors
Which factor is the benchmark for setting the price of a product in the tourism and hospitality industry?
The cost of the product
What does the law of demand state in relation to price and demand?
The lower the price, the higher the demand
What factor determines the upper limit of the price range of a product?
The demand for the product
Which factor affects price determination by considering the pricing strategies of other businesses in the market?
The price of competitors
What is the buyer's concern when determining the price of a product?
The utility of the product
Study Notes
Determining Price in Tourism and Hospitality
- The most important factor in determining the price of a product in the tourism and hospitality industry is demand.
Law of Demand
- The law of demand states that as the price of a product increases, the demand for it decreases.
Price Determination Factors
- The seller considers the cost of production when determining the price of a product.
- The price range of a product depends on the cost of production, market conditions, and competition.
Competitive Pricing
- The pricing strategies of other businesses in the market (competitors) affect price determination.
Benchmark Pricing
- The benchmark for setting the price of a product in the tourism and hospitality industry is the market price.
Law of Demand and Price
- The law of demand states that as the price of a product increases, the demand for it decreases, and vice versa.
Upper Price Limit
- The upper limit of the price range of a product is determined by the maximum amount customers are willing to pay.
Competitive Pricing Strategies
- Considering the pricing strategies of other businesses in the market affects price determination.
Buyer's Concern
- The buyer's primary concern when determining the price of a product is the value they receive for their money.
Test your knowledge on factors that affect price determination in the tourism and hospitality industry. Explore how product cost, distribution costs, and selling and promotion costs influence pricing strategies.
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