Average Price Charged

Posted in Marketing and Strategy Terms, Total Reads: 463

Definition: Average Price Charged

Average Price charged is a concept in which the prices of advertising are calculated over a period by averaging out the cost that has been incurred over a given time period. It helps in calculating the average monthly costs.

How to calculate Average Price Charged

Let us suppose the following cost incurred over a period of 12 months.

January- $25000

February- $30000

March- $40000

April- $45000

May- $20000

June- $35000

July - $36000

August- $32000

September- $31000

October- $26000

November- $24000

December- $22000

Now while reporting this figure for the sake of simplicity we can just average out the figure and report the same as our marketing cost.

So for the whole year the marketing cost incurred is found out to be = (25000 + 30000 + 40000 + 45000 + 20000 +35000 +36000 +32000+ 31000 + 26000 +24000 + 22000)/12

= $ 30500

This reporting makes it simple and easier to report and hence is followed.

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