Question

How are prices fixed by a seller/producer?

Answer 1

 In any market transaction between a seller and a buyer, the price of the good or service is determined by supply and demand in a market.

Answer 2

1) First, the seller/producer will find the cost of the product by taking into account all the Direct Material, Indirect Material, Direct Wages , Indirect wages and Direct Expenses , Indirect Expenses

2) He then, adds a percentage of profit on cost to the cost.

3) This COST + PROFIT gives him the selling price.