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What is MSRP?

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MSRP, or Manufacturer Suggested Retail Price, is the selling price that a manufacturer recommends for its products. It is also sometimes referred to as the list price, and is most commonly associated in the car industry. Manufacturer prices are used for marketing by retail businesses and for comparison shopping by consumers. Setting Prices Any product can be given an MSRP, although they are especially common for automobiles, electronics, appliances, and other higher price goods. Because it is set by the manufacturer, it does not change at different stores or locations. The price is meant to reflect the costs involved in manufacturing and selling the product, and in most cases, an average mark-up by retailers is taken into account. Suggested prices are set so that each participant in the selling process — the manufacturer, the wholesaler, and the retailer — can make a profit from the final sale. If the MSRP is set too low, and the retailer feels it cannot make enough mo...