1.

Cost-Based Pricing:

 Formula: Selling Price = Cost per Unit + Markup Rate

 Where:

o Cost per Unit = Total Cost / Number of Units

o Markup Rate = Desired Profit Margin / Selling Price

o Desired Profit Margin = (Profit / Revenue) x 100%

 Break-Even Analysis:
o BEP (Units) = Fixed Costs / (Unit Selling Price - Variable Cost per Unit)
o This formula calculates the number of units that need to be sold to cover all
costs and break even.
 Mark-Up Pricing:
o Selling Price = Cost per Unit (1 + Markup Rate)
o This formula adds a desired markup percentage to the cost per unit to arrive at
the selling price.
 Target Profit Pricing:
o Selling Price = Cost per Unit + Desired Profit / Units Sold
o This formula calculates the selling price needed to achieve a desired profit level.

2. Value-Based Pricing:

 Formula: Selling Price = Perceived Value to Customer

 Where:

o Perceived Value = Customer's Willingness to Pay - Cost of Substitute

3. Competition-Based Pricing:

 Formula: Selling Price = Competitor's Price + (Price Adjustment)

 Where:

o Price Adjustment = (Differentiation Factor) x (Price Multiplier)

o Differentiation Factor = (Unique Features / Competitor's Features)

o Price Multiplier = (Value Perception of Differentiation)

4. Target Profit Pricing:

  Formula: Selling Price = (Desired Profit + Total Cost) / Number of Units

 Where:

o Desired Profit = (Profit Margin x Revenue)

5. Psychological Pricing:

 Formula: Varies depending on the specific strategy

 Examples:

o Odd-Even Pricing (e.g., $9.99 instead of $10)

o Price Anchoring (e.g., displaying a higher price before offering a discount)

o Prestige Pricing (setting a high price to convey luxury)

6. Bundle Pricing:

 Formula: Selling Price of Bundle = Sum of Individual Prices - Discount

 Where:

o Discount = (Incentive for Buying Bundle)

7. Quantity Discounts:

 Formula: Selling Price per Unit = Decreases with increasing quantity

8. Price Skimming:

 Formula: Starts with a high price and gradually reduces it over time

 Usually used for new products with high demand and little competition

9. Market Penetration Pricing:

 Formula: Starts with a low price to capture market share quickly

 Usually used for new products entering a competitive market

10. Dynamic Pricing:

 Formula: Variable pricing based on factors like demand, competitor pricing, and time

 Requires sophisticated algorithms and data analysis