Answer to Question #137342 in Economics of Enterprise for Charmaine

Question

Nieuwenhuizen (2016) states that “The primary task of a price is to cover costs and
thereafter to make a contribution to profit''.

define the seven factors which influence the pricing of products and services. You may use examples to support your answer.

Answer 1

• Product Cost: The most important factor affecting the price of a product is its cost.
• The Utility and Demand: Usually, consumers demand more units of a product when its price is low and vice versa.
• Extent of Competition in the Market.
• Government and Legal Regulations.
• Pricing Objectives.
• Marketing Methods Used.