Price point
model of pricing
In economics, a price point is a point along the demand curve at which demand for a given product is supposed to stay relatively high.
Characteristics
Introductory microeconomics depicts a demand curve as downward-sloping to the right and either linear or gently convex to the origin. The downward slope generally holds, but the model of the curve is only piecewise true, as price surveys indicate that demand for a product is not a linear function of its price and not even a smooth function. Demand curves resemble a series of waves rather than a straight line.
The diagram shows price points at the points labeled A, B, and C. When a vendor increases a price beyond a price point (say to a price slightly above price point B), sales volume decreases by an amount more than proportional to the price increase. This decrease in quantity demanded more than offsets the additional revenue from the increased unit price. As a result, total revenue (price multiplied by quantity demanded) decreases when a firm raises its price beyond a price point. Technically, the price elasticity of demand is low (inelastic) at a price lower than the price point (steep section of the demand curve), and high (elastic) at a price higher than a price point (gently sloping part of the demand curve). Firms commonly set prices at existing price-points as a marketing strategy.
Causes
There are three main reasons for price points to appear:
Substitution price points
price points occur at the price of a close substitute
when an item's price rises above the cost of a close substitute, the quantity demanded drops sharply
Customary price points
the market grows accustomed to paying a certain amount for a type of product
increasing the price beyond this amount will cause sales to drop dramatically
Perceptual price points (also referred to as "psychological pricing" or as "odd-number pricing")
raising a price above 99 cents will cause demand to fall disproportionately because people perceive $1.00 as a significantly higher price
Oligopoly pricing
In relation to customary price points, oligopolies can also generate price points.
This brief starts where responsible research should: with the source description of “Price point” as model of pricing. Everything that follows is an evidence route, not borrowed authority.
Why this record matters
The subject matters to the general reference register because the source frames it as model of pricing. Its deeper value depends on whether names, dates, institutions and citations support that framing.
The citation trail is more important than the brevity of the summary: it shows where individual claims can be examined in context. The source revision retrieved here is dated Aug 26, 2026. The linked authority identifier is Q7242629. None of the 0 selected statements returned an explicit reference.
A concise general-reference account can conceal disagreements about scope, terminology or the weight assigned to individual sources. The lead is largely declarative, so disagreement and counter-evidence require a deliberate search beyond the opening account. Authority statements aid reconciliation but still require their own references, qualifiers and ranks to be checked.
How to read it
Use the entry as an orientation point, then follow its citations and revision history. Names, dates and institutional relationships should be checked against the original record.
- Subject orientation
- Search vocabulary
- Locating named sources
The closest primary source, responsible institution and strongest cited specialist reference.
Three-step research path
- Establish the record: confirm the title “Price point”, its source revision and the description used here.
- Expand the search: follow Price point primary sources, Price point archive and Price research across catalogues and specialist indexes.
- Test the account: compare the strongest cited source with the responsible institution’s current record and note any disagreement.
Questions for further research
- Which source most directly establishes the central claim about “Price point”?
- What terminology or title could unlock a more precise catalogue search?
- Which cited source is closest to the event, object or claim?
Search terms from this dossier
This entry incorporates text from “Price point” on English Wikipedia. Contributors are listed in the page history. Text is available under the Creative Commons Attribution-ShareAlike 4.0 License. Selected authority identifiers and statements are retrieved from Wikidata under CC0; their references and qualifiers remain part of the verification path.