Enter the total cost and the quantity of the item to determine the spot price per unit. This calculator helps in understanding the price per unit of any item or commodity in the market.
Spot Price Formula
The following formula is used to calculate the spot price per unit.
SP = TC / Q
Variables:
- SP is the spot price per unit ($/unit)
- TC is the total cost ($)
- Q is the quantity of units
To calculate the spot price per unit, divide the total cost by the quantity of units.
What is Spot Price?
Spot price is the current market price at which a particular asset can be bought or sold for immediate delivery. In commodities trading, it refers to the price for which the commodity can be transacted at the moment as opposed to a future date. It is a crucial indicator for traders and investors in various markets, including stocks, bonds, commodities, and foreign exchange.
How to Calculate Spot Price?
The following steps outline how to calculate the Spot Price.
- First, determine the total cost (TC) of the asset or commodity in dollars.
- Next, determine the quantity (Q) of units purchased or sold.
- Use the formula from above = SP = TC / Q.
- Finally, calculate the Spot Price (SP) in dollars per unit.
- After inserting the variables and calculating the result, check your answer with the calculator above.
Example Problem :
Use the following variables as an example problem to test your knowledge.
Total cost (TC) = $500
Quantity (Q) = 25 units
