TRADE PRICING ANALYSIS.docx

Price or pricing is probably one of the most difficult issues to resolve in the theory of economics. Transformation from a raw material to a finish product goes through several stages of pricing which is finally reflected in the ultimate price to the consumer at the checkout counter.How these prices are set is the quintessential question of modern economic systems. It doesn’t matter if the system exists in a controlled economy where the state controls all the means of production, a semi-controlled system where the means of production are shared by public and private sectors or a market economy where the means of production are left entirely to the market. Today, a pure market economy doesn’t exist anywhere because production levels is determined by the market but regulated by the government in all of its micro and macro stages of production.