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Price Planning A price
represents the value of a goods or service for both the seller and the buyer.
Price planning is systematic decision making by an organization regarding all
aspects of pricing. The value of a goods or service can involve
both tangible and intangible marketing factors. An example of a tangible
marketing factor is the cost savings (46) . An example of an
intangible marketing factor is a consumer’s pride in the ownership of a
Lamborghini rather than another brand of automobile. For an example to take
place, both the buyer and seller must feel that the price of a goods or service
provides an equitable value. To the buyer, the payment of a price reduces
purchasing power (47) . To the seller, receipt of a price is
a source of revenue and an important determinant of sales and profit
levels. Many words are substitutes for the term price: admission
fee, membership fee, rate, tuition, service charge, donation, rent, salary,
interest, retainer, and assessment. No matter what it is called, (48)
: monetary and non-monetary charges, discounts, handling and shipping
fees, credit charges and other forms of interest, and late-payment
penalties. A non-price exchange would be selling a new iron for
10 books of trading stamps or an airline offering tickets as payment for
advertising space and time. Monetary and non-monetary exchange may be combined.
This is common with automobiles, (49) . This combination
allows a reduction in the monetary price. From a broader
perspective, price is the mechanism for allocating goods and services among
potential purchasers and for ensuring competition among sellers in an open
market economy. If there is an excess of demand over supply, prices are usually
bid up by consumers. If there is an excess of supply over demand, (50)
. A. a price contains all the terms of purchase B. obtained by
the purchase of a new bottling machine by a soda manufacturer C. where the
consumer gives the seller money plus a trade-in D. available for other
items E. prices are usually reduced by sellers F. price means what one
pays for what he wants