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Price formation

Economic terminology
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Price formation means that the price is determined according to certain laws and methods under certain social conditions. Its connotation includes the basis of price formation, the factors affecting price formation, and the way of price formation. The general basis of price formation is commodity value, which determines the level of commodity price basis. Historically, price formation has a difference between being directly based on value and being based on the transformation form of value. In addition to the value basis, the factors that affect the price formation include: the currency value affects the whole price level; The relationship between market supply and demand affects the direction and degree of deviation of specific commodity prices from the value base; National policies affect the deviation of commodity prices from the value base according to policy requirements at a certain time, place and condition. [1]
Chinese name
Price formation
Definition
The price is determined according to certain laws and methods under certain social conditions
Discipline
economics
Under different social conditions, various factors have different effects on price formation in different degrees and in different ways. stay Private ownership of means of production In society, price formation is subject to the spontaneous adjustment of commodity value, monetary value, and market supply and demand, and buyers and sellers freely decide prices in market competition. Except for those monopolized by the state, price formation is not subject to direct intervention of national policies. in China Primary stage of socialism The way of price formation is that a small number of goods and services that are important to the national economy and the people's livelihood are priced by the state; For some of the more important goods and services, the State shall set the base price, floating range, margin, profit rate, ceiling price and minimum protection price to guide enterprises in pricing; However, the prices of most goods and services are liberalized, and enterprises are allowed to set their own prices according to market supply and demand under the premise that the state regulates and controls the market from a macro perspective.