The formula to calculate the price per unit is:
\[ \text{PPU} = \frac{\text{TP}}{\text{TU}} \]
Where:
A price per unit is the average price of a good or service given a total price and total units. Using a price per unit analysis can help consumers and producers make effective decisions using the average price of a unit instead of the actual price. Average prices can help decide whether you are paying too much or too little.
Let's assume the following values:
Using the formula:
\[ \text{PPU} = \frac{100}{25} = 4 \, \text{\$/unit} \]
The price per unit is $4/unit.
Let's assume the following values:
Using the formula:
\[ \text{PPU} = \frac{250}{50} = 5 \, \text{\$/unit} \]
The price per unit is $5/unit.