Shadow price
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A shadow price is commonly referred to as a monetary value assigned to currently unknowable or difficult-to-calculate costs. It is based on the willingness to pay principle - in the absence of market prices, the most accurate measure of the value of a good or service is what people are willing to give up in order to get it. Shadow pricing is often calculated on certain assumptions and premises. As a result, it is subjective and somewhat imprecise and inaccurate.
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See also
- Market price
- Reduced cost
- Dual problem
- Linear programming
- Leonid Kantorovich
- George Dantzig
- Ramsey–Cass–Koopmans model
Unless indicated otherwise, the text in this article is either based on Wikipedia article "Shadow price" or another language Wikipedia page thereof used under the terms of the GNU Free Documentation License; or on research by Jahsonic and friends. See Art and Popular Culture's copyright notice.
