For most people cars are a one-time investment, since it is a big investment. When it comes to buying a car, price plays an important role. Car prices tend to change from time to time, depending on the market conditions, demand, competition, supply factors, introduction of newer models and various other factors. Manufacturers' pricing vary from brand to brand, from model to model and even for different trims of a particular model. This is because, the design and style of every car model is different, including the interior and exterior features, navigation system and engine configuration. Thus, model of the car, the make, the year of manufacture, the brand, and the manufacturer determine the price!

Cars can be classified by the price range into economy, mid-range, premium, luxury, and exotic. When you decide to buy a car, you need to think about the car model and options you want. Besides, your budget or how much you are willing to spend plays the most important role in your buying process. There are many areas that you need to understand before you run off to your local dealership. Here are a few terms you may hear when you are talking about price:

• Invoice Price: It is the manufacturer's initial charge to the dealer. The invoice price generally includes freight or destination charge. When you buy a car based on the invoice price, which includes freight, make sure freight is not added again to the sales contract.
• Base Price: Base price refers to the cost of the car with standard equipment and factory warranty, but without options. It is printed on the Monroney sticker.
• Monroney Sticker Price: This price includes the base price; the manufacturer's suggested retail price (MSRP) with manufacturer's installed options; the manufacturer's transportation charge; as well as the fuel economy (city and highway fuel economy ratings.) This sticker is required to be affixed to the car window by federal law, and it can only be removed by the ultimate customer.
• Dealer Sticker Price: It is a supplemental sticker, that includes the Monroney sticker price along with the suggested retail price of dealer-installed options, such as additional dealer markup (ADM) or additional dealer profit (ADP), dealer preparation, and undercoating.