Cost-plus pricing, is where the price equals cost plus a percentage of overhead or profit margin.

** Cost-plus pricing

Cost-plus pricing is a pricing method used by companies to maximize their profits.

Cost-plus pricing is used primarily because it is easy to calculate and requires little information.

Cost-plus pricing is specially useful in the following cases:

* Cost-plus pricing is useful in cases like ' Monopsony Buying ' - here, the buyers have enough knowledge about suppliers ' costs.

Cost-plus pricing might appear to be inconsistent with the economic theory of profit maximization.

Cost-plus pricing is based on average costs and not marginal costs. However, in economic theory long-run marginal and average costs are not very different.

* Cost-plus pricing

* Cost-plus ( C +) method: goods or services provided to unrelated parties are consistently priced at actual cost plus a fixed markup.

The industry is so structured that price-setting by a multi-product company will vary with the way overhead charges are allocated -- whether marginal or average pricing is applied.

Offered at $ 34 a ton, Chinese cement is pricing itself out of the market as Thailand is asking as little as $ 20 for the same quality.

In a standard business model where goods and services are exchanged for a monetary compensation, pricing of the goods is a fundamental element of the marketing process.

While some hedge funds that are based offshore report their NAV to the Financial Times, for the most part there is no method of ascertaining pricing on a regular basis.

Because of the widespread availability of ADSL services, ISDN is today primarily used for voice and fax traffic, but is still very popular thanks to the pricing policy of German telecommunication providers.

However, most economists would say that cases where pricing is even approximately equal to the value of the labor embodied are only special cases, and not the general case.

Service is a lot cheaper than taxis however, to avoid misunderstanding, agreement over the pricing need to be made before setting off.

They point out that alternative access technologies, such as wireless local loop, have proven uncompetitive and / or impractical, and that under current pricing models, the incumbent is in many cases, depending on the regulatory model, guaranteed a fair price for the use of its facilities, including an appropriate return on investment.

The implication of the rule is that the more elastic the demand for the product the less pricing power the monopoly has.

Due to perishability, only about 5 % of the world's potato crop is traded internationally ; its minimal presence in world financial markets contributed to its stable pricing during the 2007 – 2008 world food price crisis.

* The pricing structure is often based on per-minute or per-megabyte fee rather than flat rate, and may be different for different content services.

Much of the credit for the resolution of the stagflation is given to two causes: a three year contraction of the money supply by the Federal Reserve Board under Paul Volcker, initiated in the last year of Carter's presidency, and long term easing of supply and pricing in oil during the 1980s oil glut.

As a founding member of OPEC, its oil pricing policy is generally to stabilize the world oil market and try to moderate sharp price movements.

The greater the number of firms, the more probable it is that one of those firms is a maverick firm ; that is, a firm known for pursuing aggressive and independent pricing strategy.

z / OS is available under standard license pricing as well as via System z New Application License Charges ( zNALC ) and " System z Solution Edition ," two lower priced offerings aimed at supporting newer applications (" new workloads ").

National pricing is an outgrowth of increased competition in the T-carrier market space and the commoditization of T-carrier products.

The deadweight loss is then the economic benefit foregone by these customers due to the monopoly pricing.

In general, investments, distribution, income, and pricing is determined by markets.

Within the transport economics community, congestion pricing is considered to be an appropriate mechanism to deal with this problem ( i. e. to internalise the externality ) by allocating scarce roadway capacity to users.

William Vickrey, winner of the 1996 Nobel Prize for his work on " moral hazard ", is considered one of the fathers of congestion pricing, as he first proposed it for the New York City subway system in 1952.

Companies, producers, and service providers often provide certain things free of charge as part of a larger business model or pricing strategy.

Did not sell well due to combination of their pricing structure, performance problems due to p-code interpreter, and competition with native operating systems ( on top of which it often ran ).

As cities develop, effects can include a dramatic increase and change in costs, often pricing the local working class out of the market, including such functionaries as employees of the local municipalities.

Much of the true " con artistry " has been driven out of funfairs in the twentieth century, and combined with an increasing emphasis on the role of families and small children in such entertainment, contemporary showmen often find greater profit in pricing their games far above the value of the prizes being offered, with complex formulae for upgrading to the large prizes that advertise the game and instil desire among customers.

The rises in pricing of many sidestalls must often reflect the overheads of running fairground equipment-the cost of swag ( see below ), diesel, staff and rents.

*** cost plus pricing is often used along with break even analysis

Penetration pricing is the pricing technique of setting a relatively low initial entry price, often lower than the eventual market price, to attract new customers.

Therefore, cost-plus pricing is often considered the most rational approach in maximizing profits.

Subscription pricing can make it easier to pay for expensive items, since it can often be paid for over a period of time and thus can make the product seem more affordable.

When business people choose the markup that they apply to costs when doing cost-plus pricing, they should be, and often are, considering the price elasticity of demand, whether consciously or not.

Transportation planning policy advocates often support tolls, increased fuel taxes, congestion pricing and market-rate pricing for municipal parking as a means of balancing car use in urban centers with more efficient, less environmentally and socially destructive modes of transportation such as buses and trains.

With the American digital television transition making most existing portable televisions obsolete and unusable and the current infant and development stage of mobile digital television, along with the need to provide a public service to their viewers and encourage the use of the system, many American television station weather operations cooperate with radio manufacturers and local retail outlets to offer weather radios at discounted pricing to viewers ( especially in active tornado areas ), where the service is often marketed as an essential warning device on par with a smoke detector for home fires.

Sometimes the factor charges the seller ( the factor's " client ") both a discount fee, for the factor's assumption of credit risk and other services provided, as well as interest on the factor's advance, based on how long the advance, often treated as a loan ( repaid by set-off against the factor's purchase obligation, when the account is collected ), is outstanding .< Ref Name =" CPA "> J. G. Siegel, N. Dauber & J. K. Shim, " The Vest Pocket CPA ", Wiley, 2005 .</ ref > The factor also estimates the amount that may not be collected due to non-payment, and makes accommodation for this in pricing, when determining the purchase price to be paid to the seller.

Prior to the spread of manufacturer's suggested retail pricing, there were no defined prices on vehicles and car dealers were able to impose arbitrary markups, often with prices adjusted to what the salesperson thought the prospective purchaser would be willing to pay for a particular vehicle.

One of the many benefits of joining a fraternity in Germany is the especially low pricing of the often rich rooms.

Other domestic convertible bond markets are often illiquid, and pricing is frequently non-standardised.

Ronald Coase's work emphasised a problem in applying the Coase theorem: transactions are " often extremely costly, sufficiently costly at any rate to prevent many transactions that would be carried out in a world in which the pricing system worked without cost.

Using a loss leader, often a very popular good or service, is a type of sales promotion — a marketing strategy that focuses on pricing strategy.

* Reinsurers will often have better access to underwriting expertise and to claims experience data, enabling them to assess the risk more accurately and reduce the need for contingency margins in pricing the risk

After reaching the required level of sales, Sony often dropped the prices of the original title to Platinum pricing levels ( generally about half of the original retail price ), as a way to clear inventory for retailers.

The chain is characterized by relative low pricing of generic housewares, which are mostly made by and for the chain itself, often combined with original design.