Question

Explain the system of dual price policy .How does it help the poor?

Answer 1

Five main objectives of pricing are: (i) Achieving a Target Return on Investments (ii) Price Stability (iii) Achieving Market Share (iv) Prevention of Competition and (v) Increased Profits! Before determining the price of the product, targets of pricing should be clearly stated.

Answer 2

Explain the system of dual price policy .and  it help the poor.

• Dual pricing is the practise of establishing various prices for the same good or service in several markets. A company may utilise this strategy for a number of reasons, but it is typically an aggressive move to steal market share from rivals. Price discrimination and dual pricing are related concepts.
• Dual Pricing is a transfer-pricing strategy that divides clients according to their capacity to pay. Each inter-division transaction is priced using one of two different transfer pricing techniques. Depending on the target market, a variety of products are created using the dual pricing strategy.
• The Committee believes that the dual price system also promotes the establishment of mills in high-cost regions, leading to the development of a high-cost sugar industry. This is the main cause of the industry's poor financial health and the lack of investment in the sector in the absence of special incentives.
• Due to the domestic sugar industry's inability to compete with Khandsari units during periods of low cane production, a smaller proportion of the limited cane supplies become available to the mills, which worsens cyclical fluctuations in production and disadvantages the domestic sugar industry relative to imports and discourages exports.

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