Price matching is when a store offers to sell an item for the same price as another store. It is common in large stores and requires proof of a lower price elsewhere. Price matching generally only exists for identical items and may have exclusions. “We guarantee the lowest prices!” “We will beat any advertised price!” […]
The Food Price Index measures the average price of food and the factors that cause prices to change. It averages five figures: cereals, sugar, oils and fats, meats, and dairy products. The index is intended for politicians and food manufacturers to correct factors affecting prices. The food price index is a measure that shows the […]
The price cap index (PCI) determines a company’s maximum allowable price change based on three factors: exogenous, inflation, and productivity offset. It aims to balance customer protection and economic feasibility. PCI was first used in the UK in the 1980s. The main factors that influence a company’s price cap are part of an equation known […]
Interest rates and price levels are linked, with the central bank using interest rates to control price levels. Raising interest rates reduces consumer access to credit, leading to a decrease in demand and prices. Lowering interest rates can stimulate demand and increase prices. The price level and the interest rate are linked in the sense […]
Affiliated companies must conduct business at arm’s length, with no special discounts or price reductions beyond those offered to any customer. This ensures fair market value and prevents tax issues. Some countries have laws on intercompany pricing. In today’s global business environment, it is not unusual for subsidiaries of larger companies to transact business with […]
Price elasticity of demand refers to how prices and demand change in relation to each other. People with lower incomes tend to have lower price elasticity, while those with higher incomes have higher price elasticity. The availability of substitutes and competition can affect pricing flexibility. Inelastic prices can be profitable for sellers, while perfectly elastic […]
Flash pricing displays the latest stock prices on highly traded stocks when trading is so high that prices are not updated in real time. This allows investors to access information within a reasonable period of time and respond to market conditions. With improvements in technology, flash pricing is less common today. A price flash is […]
Price gouging can refer to unfair pricing or be a legal term in regions with laws against consumer exploitation during emergencies. While free-market proponents argue that raising prices during high demand is common sense, consumers often feel the brunt of high prices. Price reduction charges can result in fines, and reporting the problem is available […]
Inflation is caused by macroeconomic factors such as demand, supply, and consumption, as well as interest rates, monetary policies, and GDP. Increases in demand and limited supply lead to price increases, while excess cash in the market and employee wage demands can also contribute. Deliberate price increases by manufacturers and retailers can also cause inflation. […]
The UK Retail Price Index measures price changes for goods and services and has been part of annual statistical reports since 1947. Data comes from a national survey and excludes some households. The index is used for business purposes and to predict inflation rates. Other countries have similar indices. The Retail Price Index is an […]
The price elasticity of supply (SPI) measures how producers respond to changes in prices. A higher SPI indicates greater sensitivity to price changes, while a lower SPI indicates little or no effect on the quantity of goods produced. Manufacturers use SPI to determine how much they can charge for products without negatively impacting sales figures. […]
Price risk is the risk of investing in an asset that will be worth less than what was paid for it. Price risk management can be done by diversifying a portfolio or setting a standing order to sell stocks once their value drops below a certain level. The amount of price risk one is willing […]
Spot prices are the immediate prices at which commodities, currencies, and securities change hands. They differ from futures prices and can indicate future performance. The difference between spot and forward prices can be informative, with a higher forward price indicating an expected rise in the spot price. The spot price is the price at which […]
Rhodium’s price is influenced by supply and demand, with South Africa and Russia being the largest producers. Speculation and general market trends also affect the price, making it volatile. Investors can capitalize on price changes by understanding these factors. There are a number of factors that help determine the price that rhodium, a popular precious […]
A producer price index (PPI) tracks the wholesale prices of goods and services in a country, with weighting given to the most significant commodities. PPIs vary from country to country and are used to predict changes in consumer prices and overall economic health. A producer price index (PPI) is an economic index that tracks the […]
Price theory explains why consumers buy goods or services from a particular company, based on the agreement of price and value. Supply and demand graphs help companies understand at what price they will sell the most goods or services. External factors such as competition, consumer demand, and market size also influence price theory. Price theory […]
Price negotiations involve a buyer and seller reaching an agreement on an acceptable price for a product. In American culture, negotiations are limited to large purchases or specific retail settings, while outside North America, bargaining is common. Three main elements affect negotiations: buyer type, financial considerations, and negotiating skill. Price negotiation is a common occurrence […]
Median sales price is the approximate average price that a property sells for, calculated by adding and dividing the prices of several different sellers. It can be used to determine if a price is appropriate and to set prices for similar products. Median sales price refers to the approximate average price that a particular property […]
The price revolution was a period of rapid inflation in Europe between the 15th and 17th centuries. Theories include increased supply of precious metals, population pressures, and demographic changes. New theories periodically emerge, but a unique combination of factors likely caused the inflation and social changes. The price revolution was a period of rapid inflation […]
Setting a limit price when buying or selling stocks can be useful to investors. It allows them to set a target price and avoid overspending or underselling, but it also obligates them to comply with the broker’s wishes if the stock exceeds or falls below the limit price. Buying and selling stocks is a respected […]
