Dictionary of Accounting Terms: pricing decisions
pricing decisions
decisions faced by top management and marketing managers. How much to charge for a product or service depends on a multitude of factors such as competition, cost, advertising,and sales promotion. Economic theory suggests that the best price for a product or service is the one that maximizes the difference between total revenue and total costs. However, in reality, the price charged is usually some form of cost-plus, which is later adjusted for market conditions and competition.
