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What does ‘one price’ and ‘variable price’ mean?
‘One price’ policy is the system where all the consumers in the entire market are charge the same price for the same product during a given period of time. The discounts and allowances are same for each and every consumer without any discrimination.
On the other hand, ‘Various price’ policy is the system where the seller can charge different prices from different customers for the same quantity of a product. This practice is known as price discrimination and benefits the buyers who have a better relation with the retailer, because it allows them extra discounts. This process might also involve bargaining.
‘Various price’ policy is dependent on the elasticity of demand for a product. If the particular consumer’s demand is inelastic, he might be charged higher prices while if his demand is elastic, he might be charged comparatively lower prices.
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