To explain: The meaning of the term price and its importance for a firm along with the meaning of the term crypto currency and block chain.
Introduction:
Price: Price is the value of any commodity or any service being offered to the consumer so that the consumer can satisfy the needs and wants.
Crypto Currency is a digital currency which has no physical presence but is available online.
Block chain is a data structure which keeps the transactional information of digital currencies.
Explanation of Solution
Price: Price is the value of any commodity or any service being offered to the consumer so that the consumer can satisfy the needs and wants. This value is in monetary terms. The price of a commodity is fixed by the manufacturer keeping in mind various factors like, demand of the product, the
Importance of price for a firm: “Price” is a critical element of marketing mix. It is important to a firm because of the following reasons-
- Price fixed by a firm affects the profit margin of a firm. A price which is too low that it does not even cover the fixed and variable cost of a firm will not generate enough revenues whereas a price which is too high will force the customers to look for substitute products.
- Price also affects the sales volume of a firm directly, other factors remaining constant.
- Price also affects the image and position of the firm in the market. If the customers find price to be very high, the consumers will gradually leave that firm and eventually the demand will decline.
- A firm can penetrate into the market if the firm keeps the price low in the beginning, other factors being constant.
- Price also affects the other elements of marketing mix. Hence, price fixation is considered to be the most crucial decision for a firm.
The above mentioned points show that why price is so important to any firm.
Crypto currency: Crypto Currency is a digital currency which has no physical presence but is available online. This is different from a regular currency in a way that crypto currency is not a legal tender and is not yet accepted as a mode of payment by everybody. Crypto currency is available in the form of digital coins which are kept in a digital wallet. One can purchase or sell anything provided the other person accepts the payment in crypto currency. This currency is traded like a security is traded in the financial market and likewise a person can make
Block chain:Block chain is a kind of a chain which maintains security and transparency of digital currencies by maintaining information on transactions of such currencies and is connected with a peer to peer network like a chain. Block chain uses various functions and coding which is hard to crack which keeps the data secure from hackers.
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