# Price

A *price* describes what an offer request per unit it delivers. Prices on a market are expressed in quote per base (`quote/base`

) for both asks and bids (as indicated by the base-quote terminology), allowing prices to be directly compared across asks and bids.

On the *asks* side, this is fairly natural: The price is the ratio $wants/gives$ between the amount $gives$ of base tokens promised by an offer and the amount $wants$ of quote tokens it requests.

On the *bids* side, however, the price is the reciprocal of the $wants/gives$ ratio, i.e. price = $gives/wants$. This is because a bid wants base tokens and offers quote tokens and thus the ratio $wants/gives$ is in `base/quote`

.

Thus, a *price* corresponds the $wants/gives$ ratio of an offer in the following way:

- For an
*ask*, $price = ratio = wants/gives$ - For a
*bid*, $price = 1/ratio = gives/wants$.

On a WETH/DAI market, prices are expressed in DAI per WETH (DAI/WETH), eg. 2,224 DAI/WETH.

As always when dealing with ERC-20 tokens, care must be taken to handle decimals appropriately.

Just as for token *amounts*, ratios and prices have both raw and user representations.

See the Ticks, ratios, and prices page for a detailed explanation, including formulae for converting between these representations.

## References

- Technical reference for ticks, ratios, and prices