I've worked in competitive pricing before and have a little knowledge of how this works. At all times, companies in competitive situations have a basic economi

I've worked in competitive pricing before and have a little knowledge of how this works. At all times, companies in competitive situations have a basic economic model they use for pricing. Individual sales reps are allowed to cut price to X level for orders above Y quantity, and if they want to violate that price floor they need executive approval. Simultaneously, the companies have models that are dependent on competitive pricing -- that take into account some assumptions about price and how it affects market share. When a competitor moves in one direction, the executives consult this model to decide how to respond, but at least in the situation I was in, the final decision of how much to cut price was a seat-of-the-pants decision by the EVP of Sales. By "model" I mean an Excel spreadsheet, but I'm sure Amazon is far more sophisticated.