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Question - Pricing is determining the value of a product or service. It leads to other financial decisions, such as how many products to produce, what costs will be incurred, and at what quantity the revenue will be positive.
Pricing a product or service is perhaps the most difficult task for a business owner or a firm. It is also one of the most important decisions to make. Pricing leads to the product quantity, the costs associated with each item produced, and the breakeven quantity when the revenues are positive.
Assume you are a small business owner (you can determine the name of the product or service you provide). How would you go about setting a price for your product or service? Explain your process and name your product and price. How do you know that your price is good?
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