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Price is the cost that purchases a finite quantity, weight or another bunch of goods or services. Price, in other words, articulate the value of goods produced and the services provided by the components of output such as land, labor and capital. 

Thus, the determination of prices is of tremendous importance in an economy. If any student is assigned to do their assignment of price determination, it will be wise for the students to take help from the best known academic writer BookMyEssay in the form of Price Determination assignment help.

What is the Determination of Prices?

The determination of prices implies inferring the price of goods and services, provided in the free market. In a free market, the forces of demand and supply adjust the prices. Usually, the government does not meddle in the determination of prices of goods and services.


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However, on some occasions, the government comes to interfere in the determination of prices of certain goods. For instance, the government has fixed the Minimum Selling Price (MSP) for rice.

What are the Main Factors that Affect the Determination of Prices?

Several factors affect the determination of prices. Price Determination assignment help by BookMyEssay highlights every factor determining the price in details and eases the pressure on the student to make the assignment on it.

Cost of Production: The production cost is one of the most crucial factors that determine the price of a product. The production cost is the total fixed cost, variable cost and semi-variable cost. The fixed cost implies the cost that remains steady through all levels of production or sale such as salary, rent and so on. The variable cost consists of the expense that is promptly associated to the levels of production or sale. The semi-variable expense includes the cost incurred through the production, dispersion and selling of the product.

Demand for the Product: Generally, when the demand for a good goes high the price rises and when the demand for the products fall, the price of the product falters too. When the demand for a product is elastic, little changes in the price of the product may result in a sea change in the quantity demanded.

Completion in the Market: The degree of competition in the market also determines the price of the product. When the competition in a market is low, a farm can fix any price of the product it launches. However, in a highly competitive market, the price of the goods can be fixed keeping into consideration the price of substitute goods.

Legal Regulations: The firms that enjoy a monopoly over the market can price the goods at higher ends to reap the benefits. However, to preserve the concerns of the public, the government interferes and restricts the prices of certain products like life-saving drugs.


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How to Determine the Equilibrium Price?

When the supply of a product is equal to the demand of the product, it is called equilibrium. In graphic representation, when the demand curve insects the supply cure, that investing point gives the equilibrium price of the product.

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