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Chapter 9 - Determining Fair and Reasonable Pricing

9.2 Price or cost analysis requirement

9.2.1 Price analysis

Price analysis is the process of deciding if the asking price for an IT product, solution or service is fair and reasonable, without examining the specific cost and profit calculations the supplier used in arriving at its price. It is basically a process of comparing the price with known indicators of reasonableness. When adequate price competition does not exist, some other form of analysis is required.