The article discusses how prices are set in the retail industry, focusing on the relationship between wholesale and retail prices. The researchers found that retail prices do not always reflect wholesale prices due to additional costs faced by retailers and their direct response to changes in demand. They also discovered that retail prices are not as rigid as manufacturer prices, with different categories showing varying levels of price flexibility. Additionally, competition within a category influences how much of the cost is passed on to consumers. Overall, the study highlights the complexity of price dynamics in the retail sector and how it differs from traditional economic models.