price

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Price

The value of a thing with real or perceived worth. Price represents the amount of value the market has assigned, fairly or unfairly, to a good or service. Normally, prices are expressed in terms of money, but practices such as countertrade and PIK securities indicate that prices may be expressed in goods: "four chickens for two sheep." Price is a necessary component of trade.

Prices tend to be regulated by the law of supply and demand; that is, a price of a good or service increases with smaller supply and/or greater demand. A corollary to this is the idea that commoditization drives prices down because it increases supply (sometimes vastly) while leaving demand the same. Prices likewise rise when the value of money declines. Governments can and have controlled the prices of certain goods and services by subsidy or decree. This is usually an anti-inflationary measure and tends to distort, rather than eliminate, the law of supply and demand. It is thus not generally sustainable as a mechanism for controlling price.

price

The dollar amount at which a security trades. Stocks are nearly always quoted fully (that is, $25 means $25 per share), while bonds are ordinarily quoted as a percentage of par value (that is, 98 represents $980 per $1,000 par bond).

price

the money value of a unit of a GOOD, SERVICE, FINANCIAL SECURITY or ASSET which a buyer is required to pay a seller to purchase the item. Usually the price of a product is fixed by the seller in advance on the basis of the costs of producing and selling the product and the seller's desired profit margin. In other cases, however, prices are variable, being determined by prevailing demand and supply conditions as with the sale, for example, of a STOCK or SHARE, a house or items sold at an auction.

Because a purchase involves a money outlay on the part of buyers who operate within a budget constraint, the price of a product is an important factor in the buying decision. It may well be the paramount consideration in many cases, but for some purchases other elements in the MARKETING MIX (product quality and performance etc.) may be equally if not more important. Thus, although many products (especially COMMODITY-TYPE PRODUCTS) tend to be sold at low, competitive prices, many others can be sold at higher prices, providing customers with a variety of price-quality trade-offs and other product attributes. See MARKET STRUCTURE, MONOPOLY, BUYER'S MARKET, SELLER'S MARKET, PRICING, PRICING OBJECTIVES, PRICING METHODS, FOUR P'S OF MARKETING.

price

the money value of a unit of a GOOD, SERVICE, ASSET or FACTOR INPUT. In some markets (for example, see PERFECT COMPETITION), price will be determined entirely by the forces of DEMAND and SUPPLY. By contrast, in other markets (for example, MONOPOLY markets) powerful suppliers have considerable discretion over the price that they charge. In certain circumstances, prices may be subjected to governmental PRICE CONTROL or regulated by means of PRICES AND INCOMES POLICY. See also EQUILIBRIUM MARKET PRICE, ADMINISTERED PRICE.

price

An amount of money exchanged for something of value.

References in periodicals archive ?
The results from this study indicate that with proxy bidding, temporary and permanent buy prices are equally effective at raising revenue, but temporary buy prices result in more early bidding.
However, as our focus here is on different types of buy prices, and as auctions with buy prices are more complicated than those without (particularly in the case of proxy bidding), we have chosen to include only those sessions in which subjects were able to gain experience in a simpler environment before moving to a more complicated one with buy prices.
The introduction of a buy price (whether temporary or permanent) to risk-averse bidders increases revenue for a wide range of buy prices, and when bidders have either CARA or DARA, the optimal introduction of a permanent buy price results in higher revenue than that of a temporary buy price.
A buy price allows the seller, during the listing of his or her item, to indicate a price at which he or she would be willing to sell.
The buy price has been implemented by different online auction sites using various rules.
The popularity of the buy price raises several interesting questions.
The experiments discussed here make use of three types of auctions: auctions with no buy price, auctions with a temporary buy price that disappears once a bid is made, and auctions with a permanent buy price that is available throughout the entire auction.
The presence of bidder risk aversion as a motivation for the use of a buy price has been explored theoretically by Budish and Takeyama (2001), Hidvegi et al.
Shahriar and Wooders (2007) present the results of an experiment that examines a temporary buy price in auctions with both private and common values.
This study is an exploration into the revenue, utilization, bid timing, and efficiency differences that arise when using a permanent or temporary buy price and how these differences are affected by the presence or absence of proxy bidding in a controlled laboratory setting.