Following factors will be considered:
(a) Internal Factors: It includes:
1) Profit sought from the sale of the toy car: More profit will mean more price.
2) The image sought by the firm through pricing: In case brand name is to be created then additional expenditure is required.
3) Cost of manufacturing of the toy car: More is the cost more will be the price.
4) Marketing charges for marketing the product: Extensive marketing will mean more expenses for raising the sales.
5) Price elasticity of demand of the toy car.
(b) External Factors: External factors which include on pricing are:
1) Nature of Competition: If competition is intensive then lesser price will have to be kept and vice-versa.
2) Bargaining power of major consumers: In case the market is having bargaining customers, then more price will be kept.
