Explain briefly any four factors discussed in the given case related to the concept so identified.
Four
factors affecting price determination are:
(i) Production cost: The price should recover all costs viz. fixed costs,
variable costs and semi variable costs apart from obviously including a fair
return for undertaking the marketing effort and risk.
(ii) Utility and demand: While determining the price of any product, the
utility provided by it and the intensity of demand should not be ignored. If
buyer is a\satisfied that the given product meets his/her requirement, he would
also be ready to pay the cost and reasonable margin to the producer.
(iii) Extent of competition in the market: In case of monopoly, a firm can enjoy
complete freedom in fixing prices. However if it is facing competition, it
should consider the prices charged by the competitors also.
(iv) Marketing methods used: Pricing of products also gets affects by the
elements of marketing such as amount spent on advertisement, type of packaging,
discounting policies, credit or finance facilities, etc.
Four
factors affecting price determination are:
(i) Production cost: The price should recover all costs viz. fixed costs,
variable costs and semi variable costs apart from obviously including a fair
return for undertaking the marketing effort and risk.
(ii) Utility and demand: While determining the price of any product, the
utility provided by it and the intensity of demand should not be ignored. If
buyer is a\satisfied that the given product meets his/her requirement, he would
also be ready to pay the cost and reasonable margin to the producer.
(iii) Extent of competition in the market: In case of monopoly, a firm can enjoy
complete freedom in fixing prices. However if it is facing competition, it
should consider the prices charged by the competitors also.
(iv) Marketing methods used: Pricing of products also gets affects by the
elements of marketing such as amount spent on advertisement, type of packaging,
discounting policies, credit or finance facilities, etc.
