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Which one of the following reflects an intrinsic or true value for factors or products

  By GK Planet Team      
Q. Which one of the following reflects an intrinsic or true value for factors or products?
  1. Price inflation
  2. economy pricing
  3. Penetration Pricing
  4. Shadow Pricing
Answer: Shadow Pricing

A shadow price is commonly referred to as a monetary value assigned to currently unknowable or difficult-to-calculate costs.
Shadow prices are prices indicating the intrinsic or true value of a factor or product in the sense of equilibrium prices.
Intrinsic value is a way of describing the perceived or true value of an asset. This is not always identical to the current market price because assets can be over- or undervalued.

Price inflation is an increase in the price of a standardized good/service or a basket of goods/services over a specific period of time (usually one year).

Economy pricing is a method of pricing in which a low price is assigned to a product with decreased production costs.

Penetration pricing is a pricing strategy where the price of a product is initially set low to rapidly reach a wide fraction of the market and initiate word of mouth. The strategy works on the expectation that customers will switch to the new brand because of the lower price.
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