Then auctions like eBay are another example of dynamic pricing.

Dynamic pricing is exactly what it sounds like.

Price

The price of gold fluctuates daily.

Pay careful attention the next time you read the financial news.

But there's another type of pricing.

If you ever think about it, pricing that you negotiate yeah, we kind of have this price on paper, but that's just the starting point of the conversation.

That just means that the last three yield management, real time, and auctions are examples of dynamic pricing.

So let's talk about our first scenario here, where let's say this curve, people didn't expect prices to change for my e book and now all of a sudden, people expect there's a change in expectation.

Par value

Redemption

Present value

Present values

Future value

Dr. Price?

Wenneck, Price, Garner.

That's dynamic pricing.

They want to encourage high volume purchases, and so they have stepped pricing that is oriented to create volume.

Dynamic means it moves.

The stock market is a real time market.

So let's look at possible theories.

Alright?

It's not about low cost.

I could actually price on specific customer segments or on features I know they need.

And so the first of these that I will focus on the first is the price of competing products.

For any given price, it's going to lower the quantity demanded.

See...notice I get my axes confused

Let's say a guy invents a better light bulb.

The price of admission.

How could you have prices that kind of move?

But to make it more real, if the price of an automobile had fallen as rapidly as the price of computing power, you could buy a car today for five dollars.

It turns out we made this pretty easy.

And we see that the last trade here was for 2.58.

But there are two types of prices.

It is traded.

That sounds about right. It's within the right range at least.

You would be correct that Company B was cheaper.

She's too young for this.

And you know that it's going to be 100.

Next thing I learned from Steve Jobs is

It's the best price that someone's willing to give you for something.

Now we can draw a similar demand curve for this very cheap automobile.

House prices have remained static for several months.

So I would shift the whole supply curve would shift to the left.

So that's fine.