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How should prices be set when it is difficult to determine the actual cost of production?
Wiki User
∙ 15y ago
Price and cost are independent (think of supply and demand). Price will be determined by the market. If an item sells for $100, it will sell at $100 regardless of whether the cost to produce was $10 or $99. The question is whether or not you will produce that product at the available profit margin. If the costs are difficult to determine, that means there is some additional risk involved. A riskier product requires a higher return. So compare the projected market price to the expected value of the production costs to see if the return is sufficient to warrant the risk.
Wiki User
∙ 15y ago
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OPEC uses supply and demand to determine prices. If they want to raise the price, they slow down production. The lower supply will equal higher prices.
When the market mechanism is allowed to operate freely prices will determine?
The mix of output to be produced, the resources to be used in the production process, and for whom the output is produced
What motivates suppliers to increase production in the face of high demand and high prices?
The suppliers increase production with higher prices because there is more profit margin.
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Prices in a market economy help determine the equilibrium. Consumers will not pay a price higher than its perceived value.
Factors of production OF A car?
You need to decide what features to put on the car. Then determine the prices and who you will sell it to.
What method does 'OPEC' use to raise the price of oil?
OPEC uses supply and demand to determine prices. If they want to raise the price, they slow down production. The lower supply will equal higher prices.
When the market mechanism is allowed to operate freely prices will determine?
The mix of output to be produced, the resources to be used in the production process, and for whom the output is produced
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The suppliers increase production with higher prices because there is more profit margin.
What has the author Albrecht Ritschl written?
Albrecht. Ritschl has written: 'Prices and production' -- subject(s): Mathematical models, Prices, Production functions (Economic theory)
What motivates suppliers to increase production the face of high demand and high prices?
The suppliers increase production with higher prices because there is more profit margin.
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The black book car values are calculated by comparing the actual sale prices for a vehicle. Other books determine the value of a vehicle by its appraised value.
Prices in a market economy determine?
Prices in a market economy help determine the equilibrium. Consumers will not pay a price higher than its perceived value.
Mass production resulted in?
Reduced prices of goods.
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