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setting selling prices, need to know full cost

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Discuss the issues that must be taken into consideration when setting selling prices, which is the usual reason given for the need to know the full cost.

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The expert discusses the issues that must be taken into considerations when selling prices. The discussion is 369 words in everyday language suitable for a novice.

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Selling prices are typically decided by either market prices or cost-plus-profit prices. If the product is an essential product (like milk or gas) and has easy substitutes, the price will be set by market (if you price it above market, you won't sell because they can get another easy substitute). If the product is discretionary (people don't have to have it, like exotic tea) or no substitutes (like Apple i-pad), then the price is more cost-plus-profit pricing.

You need the full cost information under either ...

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