Law of one price (LOOP) (单一价格定律 dānyī jiàgé dìnglǜ) is an economic concept stating that the identical asset or commodity sold at different locations will have the same price globally. It is based on the assumption of a frictionless market, where exists free competition, price flexibility, and no trade barriers.
- 价格 (jiàgé) as in the market price (市场价格 shìchǎng jiàgé).
- 定 (dìng) as in fix (固定 gùdìng) and decide (决定 juédìng).
- 律 (lǜ) as in rule (规律 guīlǜ) or melody (旋律 xuánlǜ).
- 定律 as in the law of universal gravitation (万有引力定律 wànyǒu yǐnlì dìnglǜ).