pricing



fair/economic prices


1.

approximately the same economic value on each side of the transaction




2.

value created when work is done, not the sale itself



							business	customer


	wholesale cost (box of 100)			$10

	split and place on shelves

	retail value					$100


	exchange for cash (customer purchases item)			$100


	sales for the day				$100





3.


determining prices




a)

open markets with many buyers & sellers

stock exchanges

auctions etc.





b)

comparing the amount of work required to produce each item


hours worked per ounce of gold mined from the ground


	100 hours = 1 ounce of gold	(check actual amount)



cup of coffee

	= 2 hours work	(growing the beans, transporting to destination, producing the item, etc)

	= 1/100 * 2

	= 0.02 ounces of gold



