Prices determine how resources are to be used. They are also the means by which products and services that are in limited supply are retained among buyers. The price system of the United States is a complex network composed of the prices of all the products brought and sold in the economy as well as those of a myriad of services, including labor, professional, transportation, and public-utility services. The interrelationships of all these prices make up the "system" of prices. The price of any particular product or service is linked to a broad, complicated system of prices in which everything seems to depend more or less upon everything else.
If one were to ask a group of randomly selected individuals to define "price", many would reply that price is an amount of money paid by the buyer to the seller of a product or service or, in other words, that price is the money value of a product or service as agreed upon in a market transaction.
Transaction at a Farmers' Market in 2009.
Priced Out Of Lingerie, Milan
English: The difference between traditional buyer-...This definition is, of course, valid as far as it goes. For a complete understanding of a price in any particular transaction, much mort than the amount of money involved must be known. Both the buyer and the seller should be familiar with not only the money amount, but with amount and quality of the product or service to be exchanged, the time and place at which the exchange wil take place and payment will be made, the form of money to be used, the credit terms and discounts that apply to the transaction, guarantees on the product or service, delivery terms, teturn privileges, and other factors. In other words, both buyer and seller should be fully aware of all the factors that comprise the total "package" being exchanged for the asked-for...