Please answer the questions using Microsoft Word. Submit your answers via this page by the due date. Each question is worth 10 points for a total of 100 points. 1. You are considering purchasing a personal computer. What factors would affect your price sensitivity in making the decision? How would those same factors affect the price sensitivity of some personal computer buyers differently?
Some of the factors that affect price sensitivity is brand name, quality of product, features and attributes, warranty and guarantee as well as customer service offered by company, etc. These factors can affect price sensitivity of other buyers in a different manner. For example, brand may not appeal in the same manner to everyone. A brand conscious buyer will be heavily affected by product's brand whereas a buyer who is more focused on technology will be less conscious by brand name of the product. 2. What can a company do to decrease its customer’s price sensitivity? Would all of the customers be likely to react in the same way?
They can reduce customer's price sensitivity by clearly highlighting the superior quality, unique product or service attributes and value proposition to customers via the marketing campaign. All the customers may not behave in the same manner because value proposition for one customer varies from another's value proposition or in other words, purchase criteria for one customers is different from another customer. 3. Many local rental car agencies rent late model cars at substantially lower prices than national companies such as Hertz or Avis. Despite their higher prices, the national companies still retain most of the market. Explain why most renters patronize the national car rental companies despite their higher prices. How have the national companies encouraged this price insensitivity? 4. A company can gain a substantial market share