There are many factors which decide the selling price of a product:
• Highest price that buyer is willing to pay
• Lowest price that seller is willing to accept
• Price that competition will allow
Some companies form a cartel by colluding with other suppliers in order to control the selling price. This action is against the law and punishable crime.
For example: Selling price of wafer chocolate is Rs 10. A buyer is not willing to pay more than this and seller will not accept any price less than Rs 10. Also other competitive wafer chocolates are also sold at the same price like Perk, Munch, etc.