Delivered pricing and 2025

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The document presents a study on price and production competition among profit-maximizing firms using delivered spatial prices, focusing on the implications of quantity-dependent transportation costs and price elastic customer demand. It introduces a game-theoretic model to establish the existence of a delivered price and production equilibrium, highlighting unique properties of spatial pricing that differ from traditional models with inelastic demand. The paper discusses how firms may choose coincident locations and adopt delivered mill pricing strategies, contributing to the understanding of competitive dynamics in spatial economics.

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What is an example of FOB pricing?

In other words, the supplier is free of responsibility. On board simply means that the goods are on the ship. As such, FOB shipping means that the supplier retains ownership and responsibility for the goods until they are loaded on board a shipping vessel. Once on the ship, all liability transfers to the buyer.

What does FOB mean in pricing?

There are three main pricing strategies: value-based pricing (based on customer value), cost-based pricing (based on production costs), and competition pricing (based on prices set by the competitors). New product pricing strategies include price skimming and pricing.

What is FOB pricing vs delivered price?

FOB Example Lets say a buyer from the United States is purchasing a container of auto parts from a seller in China. The seller agrees to FOB Origin terms, which means that they are responsible for the costs and risks associated with transporting the goods until it arrives at the port of departure.

What is FOB pricing and delivered pricing?

Under f.o.b. pricing, buyers face a price that reflects exactly the transportation cost between sellers and themselves. Under uniform delivered pricing (u.d.p.), the seller charges the same price to all buyers, inclusive of delivery.

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