What is a product?
Market relations imply a commodity turnover. Therefore, with such a relationship, the product is an integral part of life. In order to understand what can be a subject of trade, it would be nice to first clarify what a product is, that is, to give it a definition.
A product can be any thing or product produced by human labor. And any product or thing can be a subject of exchange or trade. As for marketing terms, they state that everything can be a commodity with the help of which it is possible to satisfy any need. And only after that the goods are considered as something produced for the purpose of sale.
All products have their own classification. They are divided into:
- consumer goods - everything that is produced for general consumption;
- manufactured goods - that is intended for industrial use.
In order for a product to be recognized as such, it must have:
- own value;
- market value.
Having figured out what a product is, it remains to understand what the term “cost” means.Own value (cost of the consumer) is determined by the ability of the goods to meet any human need. But in order to be exchanged, goods must have one common characteristic - value or price.
The market value is determined by the amount of labor and time spent on the production of a particular product, taking into account logistic costs and trade margin. You can also consider the product from the standpoint of its benefits to humans. And, of course, the price of a product is affected by its competitive advantages in a market with similar products.
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