Economics

Prices
base selling prices:
(1/2 book cost) * (seller mod) * (buyer mod) * (legality mod)

base item cost:
(book cost) * (seller mod) * (buyer mod) * (legality mod)

(how the seller feels about you)
seller mods
hates: 2 (you probably got caught stealing)
dislikes: 1.5 (typical of unknown sellers)
neutral: 1 (typical of known sellers)
likes: .75 (you are friends)
adores: .5 (there's got to be a spell going on)

(what the seller thinks the buyer is)
buyer mods
very shrewd: .5 (ooh, you're really good, or just buying a crap-ton of items)
shrewd: .75 (ooh, you're good, or just buying a bunch of items)
neutral: 1 (typical when the seller knows the buyer)
gullible: 1.5 (typical when the seller doesn't know the buyer)
very gullible: 2 (you just fail at life)

small illegal items are cheaper because they are easier to hide
I reserve the right to determine the legality of items
legality (size) mod:
legal: 1 (most common things)
distrusted: 1.25 (unusual items of dubious use)
illegal (small): 3 (pocket sized illegal objects)
illegal (large): 4 (hard to hide illegal objects

example 1

buying a backpack:
basic cost=2gp, unknown seller(dislikes:1.5/gullible: 1.5), legality(legal:1)
seller will ask (2 * 1.5 * 1.5 * 1)=4.5 gp for the backpack

example 2

buying chain: (people don't typically buy chain, it's legal, but barely)
basic cost=30gp, known seller(neutral:1/neutral:1), legality(distrusted:1.25)
seller will ask (30 * 1 * 1 * 1.25)=37.5 gp for the chain

example 3

buying thieves tools: (an easy to smuggle item)
basic cost=30gp, friend seller(likes:.75/neutal:1), legality(illegal[sm]:3)
seller will ask (30 * .75 * 1 * 3)=67 gp for thieves tools

Haggling
you can change the sellers opinion of you, the buyer with haggling
skill options:
appraise + diplomacy:state the real price and haggle to a consenses (successful appraise check increases chance of diplomacy working)
bluff or diplomacy:guess the real price and haggle to a consensus
intimidate: guess the real price and haggle to a consensus (rarely works, legal merchants tend to call in the city guard when you start threatening them, illegal merchants usually have muscle hiding somewhere)
spells(charm, etc.):guess the real price and haggle to a consensus

successful haggling bumps you up one buyer level (temporary price decrease)
crit success or succeeding by 20+ bumps you up 2 buyer levels (temporary big price decrease)
crit fail or failing by 10+ drops you 1 buyer level, bumps seller up 1 level for 1d6 months (semi-permenent price increase)

semi-permenant changes: (all effects stack)
-regular trade with the same merchant drops seller 1 level for 1d4 months after regular trade stops
-being friends with a merchant drops seller 1 level for as long as friendship lasts
-getting caught stealing(each time) increases seller 1 level for 1d6 months
-getting caught stealing on level (seller: hates) = jail sentence
-spells drop seller 1 level for spell duration

(continuing from before)

example 1

Haggling over a backpack:
cost=4.5gp
haggling=success
new cost=3.5gp

example 2

Haggling over chain:
cost=37.5gp
haggling=fail
new cost=37.5gp

example 3

haggling over thieves tools:
cost=67 gp
haggling = crit success
new cost = 33.75

When you are the seller
NPC buyers are not stupid. Typically, they:
-expect seller: neutral/ buyer: neutral mods
-know the average price if items as well
-expect discounts from their friends
-expect discounts when buying in bulk
-will try to haggle if the price is not to their liking
-will not spend more than 1.5x book value for common items
-like sales

The better the deal/experience when NPC's buy from you, the more likely they are to go to your shop again.

** You do not have to follow my pricing guidelines when setting pricing on items you are selling, this is just how I determine things, and what NPC's will expect when buying items from you.

Crafting:

How much does it cost:
You cannot just arbitraily buy components to craft things. You must buy them from someone. All items are made up of three parts. Each part costs 1/3 of the total component cost.
-You must declare what the components are for when you buy then, because components cannot be shared between items.
-You do not have to buy all three components at the same spot. Just declare which one you are buying (a, b, or c).

You want to make a sword, so you must buy Sword Part A, Sword Part B and Sword Part C. you can buy them all at the same place for convenience, or you can buy the pieces from different merchants if you are trying to hide the fact that you are making a sword.

Basic probability of seller correctly guessing what you are making:
you bought 1 component : 25%
you bought 2 components : 50%
you bought 3 components : 75%

total normal item component cost: 1/3 item cost
total magic item/potion component cost: 1/2 item cost

How long does it take:
regular items:
points to finish: book value(in sp)
points per craft check (8 hours of work): (Check result * DC / 7)
when points result exceeds points to finish, you have two options:
1) use those points on a similar object (same skill requirement/DC)
2) use total points/8 = points per hour to find how many hours it took to finish
** for regular items only, you can add 10 to the DC to try and make an item faster

magic items/potions:
book value(in gp)/ 125 hours
minimum: 2 hrs.
each skill check lasts up to 8 hours, it can only be spread among like items.

all items:
you can only make one item at a time
*exception* you can make one potion per alchemist lab.

Every time you have multiple alchemist labs going at the same time, in the same building, you run the risk of an explosion or toxic fumes.

same potion-toxic fumes risk

roll percentile dice, if you get equal to or lower than total, the building is filled with toxic fumes until 1d6 hours after all labs are turned off. Toxic fumes: Fort DC 10 +(combined level of all potions), (combined level) d6 damage
per lab(same room): 25%
per lab(adjacent rooms): 10%
per lab(distant rooms): 5%

different potions-explosion risk

roll percentile dice, if you get equal to or lower than total, a fireball engulfs the building (centered on the last started potion). The fireball's level is the combined level of all the brewing potions.
Alchemist(started or overseeing all potions): -25%
per lab(same room): 60%
per lab(adjacent rooms): 40%
per lab(distant rooms): 30%

Crit Success/Failures
crit success(for magic items only): takes 1 less hour *minimum total time is still 2 hours
crit fail normal items: lose (20-(check result)) * DC points
crit fail magic items: lose 8 hours work.

so how does this affect starting items?

it does not, it only effects things in-game