Opposite of Full Cost Pricing which is based on cost of production.It is based on market situation. The firm will adjust its own price policy in time with the general pricing structure prevailing in the industry. Happens in Oligopolistic, Pure competition and Monopolistic Competition.In some industries like clothing, automobiles, electronic goods, etc firms even tailor the cost of production to the prevailing (or going ) price.Followed in case of products whose development has reached a stage of maturity. Producers and consumers accept a stable price relationship.Firms tailor costs given the prices.
GRP is adopted when:
•Costs are difficult to measure
•The firm wants to avoid tension of price rivalry in the market
•When there is price leadership of a dominant firm in the market.
It helps to explain the costs of capital by creating a model which intuitively understands the cost of capital as a function of a small number of well-understood economic variables, such as interest rate, demand, future discount, and capital stock.
External pricing is pricing of goods and or services that will be sold to out side company's. While internal pricing are prices set to sell goods to another department with in its own company.
Cost based pricing uses the costs that were invested in producing the goods. In market based pricing, supply and demand are the key factors that determine price.
The cost based pricing may overlook costs that are not monetary. Cost based pricing may overlook inefficiency Cost based pricing may not take advantage of consumer surplus.
Transfer pricing is used to attribute profit to various companies with their different tax regimes. Multi-National corporations achieve this by attributing costs and income to various parts of their corporations, often to reduce their tax burden. Countries also pass laws to restrict its use, so as to maintain the tax take.
Explain how product form pricing may be pricing option at Quills?
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The merits of the sampling methods takes the right products to the right customers. The demerit of this pricing method is that there are some goods which can't be sold therefore leading to losses.
Bid Pricing Cost Plus Pricing Customary Pricing Differential Pricing Diversionary Pricing Dumping Pricing Experience Curve Pricing Loss Leader Pricing Market Pricing Predatory Pricing Prestige Pricing Professional Pricing Promotional Pricing Single Price for all Special Event Pricing Target Pricing
An arbitrage pricing theory is a theory of asset pricing serving as a framework for the arbitrage pricing model.
transfer pricing is in the case of transferred with in the organisation the pricing of contribution for assets ,
What is Loan Pricing? How does it calculated?
It is a pricing strategy
What is Loan Pricing? How does it calculated?
transfer pricing is in the case of transferred with in the organisation the pricing of contribution for assets ,
Four pricing objectives are competitive, prestige, profitability, and volume pricing.