natural price

Definitions

A price for a good or service that is equal to the cost of production, augmented by the average profit rate.

Equivalents

Examples

“1776, Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations: Book I: Chapter 7: Of the natural and market Price of Commodities When the price of any commodity is neither more nor less than what is sufficient to pay⟳ the rent⟳ of the land⟳, the wages of the labour, and the profits of the stock⟳ employed in raising, preparing, and bringing it to market, according to their natural rates, the commodity is then sold for what may be called its natural price.”

CEFR level