Supply (or cost) If there is an abundant supply of a product or service, it may not be a candidate for being approached as a product or service for sale. Hence, time can change most everything, particularly how we perceive certain goods and services as candidates for commercial products.
b. Demand (or revenue) to justify commanding a positive price in the marketplace, there must be some demand for a product or service. We have seen above where many products traditionally considered as free, have given way to other identical or similar products for which there is now a strong consumer demand, and a price to pay. Thus, the nature of demand changes constantly for goods and services
c. Perceptions in the marketplace. A positive price simply describes how much something costs whereas a normative price describes what something ‘should cost’ based on an individual’s or a group’s opinion. Usually there are consumer expectations that help guide the normative price. For example, how many times have you heard that, ‘my water bill is too high!”
This interaction between positive price and normative price is an ongoing phenomenon and of particular interest to marketers who attempt to create and sustain customer satisfaction.
d. Competition and Competitors’ pricing strategies Third, if the firm functions in a market where there are many competitors offering similar products, the firm may not have a choice about what level price to seek. thus, we first assess buyers’ perception of how much they would expect to pay for a product or service based on the utility (or usefulness) they would expect to derive from product or service and combine these individual utility functions to create a demand curve for the product in question.

The % of a consumer’s income allocated to spending on the good – goods and services that take up a high proportion of a household’s