A firm needs to make a profit, so it can't afford to sell below the cost of production.
Product Life Cycle
- Launch = Low price
- Growth = Increased price
- Maturity/Decline = Discounted price
A firm needs to be aware of what competitors are charging.
A valued customer may be offered a special price.
Different places or conditions mean different prices.
The level of service provided affects the price.
A meal in a posh restaurant will cost more than one at a fast food place!