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Innovation and design Capstone project_Week 3 Discussion

Innovation and design Capstone project_Week 3 Discussion

Q Q-3. Describe the difference between cost-based pricing and value-based pricing.

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The chief difference between cost-based pricing and value-based pricing is that the emphasis of cost-based pricing is on the characteristics and features of service or product. On the other hand, the focus of value-based pricing is exclusively on the benefits that are offered to a consumer by a service or product in an exclusive manner. The prices in value-based pricing are of a larger range in comparison to the cost-based pricing. This is due to the fact that value happens to be an approximation of what will be paid by people to acquire benefits that are desirable. The basis of cost is quantifiable numbers ("Pricing Methods", 2019).