University:
High School
Course:
High School Business
Academic year:

2023
Views:

143

Pages:

1
Author:

anon

IB Business and Management: Added Value Businesses must increase the value of their products during production. Setting a price for your product higher than the production cost will add value and enable your company to profit from each unit of merchandise sold. For example, assume a business that manufactured air-cons built them for $1,000. The aircons would then be sold at $10,000 per unit. This means the business would have an added value of $9,000. Added value can come in different forms, which describes why people are willing to pay more money than the production cost of the products: ● Quality of service ● Quality of finished product ● Brand name and image ● Value for money ● Cheapest of the products kind