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Gives more preference to the likes and dislikes of the buyer to buy a house.It considers both internal and external factors that will affect the buyer’s decision-making.It focuses more on the customers’ consumption patterns and can price fairly.
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read more to derive the goods’ correct price.īelow mentioned are some of the major advantages of hedonic pricing: –
#Hedonic definition professional#
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The pricing per the hedonic pricing model may change as per the parameters used in the analysis.It was invented by Sherwin Rosen, a labor economist, in 1974 in a paper named “Hedonic Prices and Implicit Markets.” This model is generally used in the housing industry to determine the prices of homes based on internal and external characteristics. The hedonic pricing model is defined as a pricing model of the goods sold that considers the internal and external factors.