 | Chapter Objectives
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After reading this chapter you should be able to:
- Identify the elements that make up a price.
- Recognize the objectives a firm has in setting prices and the constraints that restrict the range of prices a firm can charge.
- Explain what a demand curve is and the role of revenues in pricing decisions.
- Describe what price elasticity of demand means to a manager facing a pricing decision.
- Explain the role of costs in pricing decisions.
- Describe how various combinations of price, fixed cost, and unit variable cost affect a firm's breakeven point.
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