ECONOMICS

Detailed explanation-1: -Cost-based pricing is a pricing method that is based on the cost of production, manufacturing, and distribution of a product. Essentially, the price of a product is determined by adding a percentage of the manufacturing costs to the selling price to make a profit.

Detailed explanation-2: -What Are The ‘4 Pricing Methods’? There are 4 Pricing Methods that can help you put a price on what you sell: replacement cost, market comparison, discounted cash flow/net present value, and value comparison.

Detailed explanation-3: -Customer-driven pricing is a pricing strategy in which a company sets prices according to customers’ perceived value of its products and services. To be effective, companies should consider how to best segment the market so that prices reflect those segments perceptions of value.

Detailed explanation-4: -“Penetration pricing makes sense when you’re setting a low price early on to quickly build a large customer base, ” says Dolansky. For example, in a market with numerous similar products and customers sensitive to price, a significantly lower price can make your product stand out.