Legal Definitions - floor price

Definition: A floor price is the minimum price that can be charged for a product or service. It is the lowest price that a seller is willing to accept for their product or service.

Example: A company sets a floor price of $10 for their product. This means that they will not sell their product for any less than $10, even if the market price drops below that amount.

Explanation: The example illustrates how a floor price works. The company has set a minimum price that they are willing to accept for their product. This ensures that they do not sell their product at a loss and helps them maintain a certain level of profitability.