--%>
Assignment Help - homework help

External factors in governing prices

What are the external factors in governing prices?

E

Expert

Verified

External Factors are as follows:

These factors are ahead of the control of organization. The given are the major external factors.

1. Demand: when the demand for a product is inelastic this is better to fix a higher price and when demand is elastic, so lower price may be fixed.

2. Competition: Number of substitutes obtainable in the market and the extent of competition and the price of competition and so forth is to be considered during fixing a firm price.

3. Distribution channels: Conflicting interest of middleman and manufacturers is one of the significant factors that influence the pricing decision. So, manufacturer would desire that middleman must sell the product at a minimum mark up.

4. General economic conditions: throughout inflation a firm forced to fix a higher price and in deflation forced to decrease the price.

5. Government Policy: when taking pricing decision, a firm has to take in consideration the taxation policy and trade policies of the Government.

6. Reaction of consumers: When a firm fixes the price of its product unfairly high, the consumer might boycott the product.

   Related Questions in Managerial Economics

  • Q : Internal factors in governing prices

    What are the internal factors in governing prices?

    		•
  • Q : Costs and revenue verses Quality

    Refer to figure as in above. What occurs when the firm produces more than Q4 units: w) Its profit raises. x) this makes a loss. y) Its total revenue is increasing quicker than its whole cost. z) this could make a profit or a loss depending upon what occurs

    		•
  • Q : Consuming extra units of goods The

    The observations that whenever output is expanded, the costs ultimately grow faster than output, and that the enjoyment people receive from consuming additional units of a specific good ultimately declines, both pursue logically from the law of: (1) Unexpected effects

    		•
  • Q : Explain the Proportional Method of

    Explain the Proportional Method of Measurement of Elasticity.

    		•
  • Q : Dominates substitution effect by wage

    The income effect of a small varies in the wage rate dominates the substitution effect for this worker at point: (w) point a. (x) point b. (y) point c. (z) point d.

    Q : Screening and Credentialism Critics of

    Critics of “credentialism” believe which firms making employment decisions tend to rely much heavily on: (1) personal contacts. (2) past experience. (3) personality testing. (4) job interviews. (5) formal training and education.

  • Q : Maximize utility in competitive

    Within the competitive resource market model, all households are assumed to sell the employ of resources in attempts to maximize: (w) income. (x) utility. (y) employment. (z) social welfare. I need a good answer on

    		•
  • Q : What are the certain assumptions in

    What are the certain assumptions in production functions?

    		•
  • Q : Dependency of labor supplies Labor

    Labor supplies depend on wage rates and also: (w) labor force participation and capital availability. (x) worker skills and preferences regarding employment. (y) technology and the price of output. (z) labor force participation and derived demand.

    		•
  • Q : HW Hello, Would you please find a small

    Hello, Would you please find a small case study in managerial economics. please I don't want the typical solution because the prof have it. thanks

    		•