Unit 2: Ethical Issues and Dilemmas

Problem of fair pricing:

Pricing decisions play a crucial role in business, and ensuring fairness while
maximizing profitability is essential.

However, what businesses consider to be fair may not align with their customers'
perception of fairness. This can lead to dissatisfied customers and lost revenue.

Most customers feel it is unfair for sellers to charge excessively high prices, even
if the majority of buyers are willing to pay those prices.

Consumers feel they have a right to a reasonable price, and that sellers have a
right to a reasonable profit. Here are some key points to consider:
 Unit 2: Ethical Issues and Dilemmas
Problem of fair pricing:
Price Discrimination and Fairness:

Price discrimination involves charging different prices to different

customers for the same product or service.
Ethical Concerns: While price discrimination can be a useful strategy for
maximizing profits, it can also be seen as unfair if it is based on factors
such as race, gender, or age.
Transparency: Companies must ensure that their pricing policies are
transparent and non-discriminatory. Justifying any differences in prices is
crucial.
 Unit 2: Ethical Issues and Dilemmas
Problem of fair pricing:

Exploitation of Vulnerable Consumers:

Some pricing practices exploit vulnerable consumers, especially those who rely
on essential goods and services.
Ethical Responsibility: Businesses should consider the impact of their pricing
decisions on vulnerable populations and ensure affordability.
Balancing Profit and Fairness: Striking a balance between profitability and
fairness is essential for ethical pricing.
 Unit 2: Ethical Issues and Dilemmas
Problem of fair pricing:
Balance of Power and Information:

In a free market, producers often have the upper hand due to control over
products and processes.
Ethical Implications: Unethical practices (using cheap materials, lying about
benefits) harm society. Ethical pricing aims to establish a balance of power
through transparency and information sharing.
Setting Ethical Standards: Businesses should view their decisions as part of the
broader community and uphold values like honesty and autonomy
Ethical pricing goes beyond legal compliance. It involves transparency, fairness, and consideration for vulnerable
consumers. Balancing economic goals with ethical practices is a complex challenge that requires thoughtful
decision-making.