--%>
Assignment Help - homework help

Internal factors in governing prices

What are the internal factors in governing prices?

E

Expert

Verified

These are the factors that are within the control of the organization. Different internal factors are as given below:

1. Cost: The price should cover the cost of production with materials, overhead, labour and administrative as well as selling expenses and a reasonable profit.

2. Objectives: whereas fixing the price, the firm’s objectives are to be considers.
Objectives might be maximum sales, stability in prices, targeted rate of return, raises market share, preventing or meeting competition and projecting image.

3. Organizational factors: It is internal arrangement of the organization. Organizational mechanism is to be use in consideration whereas deciding the price.

4. Marketing Mix: Another element of marketing product, mix, place, promotion, politics and pace are influencing factors for pricing. Because these are interconnected, vary in one element will affect the other.

5. Product differentiation: Individual of the objectives of product differentiation is to charge higher prices.

6. Product life cycle: At different stages in the Product Life Cycle, different strategic pricing decisions are to be adopted, for example. In the introduction stage generally, firm charges lower price and in development stage charges maximum price.

7. Characteristics of product: Nature of durability, product, accessibility of substitute and so forth will also affect the pricing.

   Related Questions in Managerial Economics

  • Q : Labor demand increases and supply

    Wages tend to increase while labor demand: (w) and supply both decrease. (x) decreases and supply increases. (y) and supply both raise. (z) increases and supply decreases. Please choose the right answer from above.

    		•
  • Q : Hiring more labor in profit maximization

    When a firm hires an additional worker who adds $100 worth of output daily, and adds $50 daily to the firm’s costs, in that case the firm must: (w) hire more labor. (x) hire less labor. (y) not change its employment of labor. (z) sell off some o

    		•
  • Q : Illustrates the important areas of

    Illustrates the important areas of managerial economics as a tool for decision making?

    		•
  • Q : Elasticity of the Supply of Labor of

    This supply of labor worker is roughly unitarily wage elastic as the wage rate increases from: (1) $5 per hour to $10 per hour. (2) $5 per hour to $25 per hour. (3) $10 per hour to $25 per hour. (4) $10 per hour to $40 per hour. (5) $25.01 per hour to

    		•
  • Q : The Income Effect by Supply of Labor

    Along a supply curve for an individual’s labor, there the income effect tends to rise the: (1) supply of work as wages reduce the number of people a firm will hire. (2) demand for leisure as the wage rate and income raise. (3) l

    		•
  • Q : Process of Automation Automation is the

    Automation is the process of: (1) adapting equipment which is safer for workers to operate. (2) kinetic engineering which smoothes flows of work on an assembly line. (3) scientific management of robotic factories. (4) substituting sophisticated machin

    		•
  • Q : Concept of marginal costing In what

    In what condition the concept of marginal costing basically applied?

    		•
  • Q : Higher Legal Minimum Wage Laws

    Enactment through the U.S. Congress of an extensively higher legal minimum wage would be probably to benefit: (i) American college professors. (ii) high-school dropouts in their teens. (iii) relatively unskilled foreign workers whose production is exp

    		•
  • Q : Values of marginal products of the

    Competitive product as well as resource markets yields resource prices and incomes to resource owners that are proportional to the: (1) relative prices of the goods produced. (2) values of marginal products of the resources. (3) distr

    		•
  • Q : Welfare definition of economics Explain

    Explain the welfare definition of economics? Why is it criticized?

    		•