# How Is Pricing Determined?

Another key property of LMSR is that the price of each option **pi** is the marginal derivative of the cost function.

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This means pi represents the marginal cost the user must pay to buy one more unit of that option.

This implies the following:

* As more users buy shares of a particular option, its price rises gradually.
* Over time, the price approaches the market’s collective subjective probability of that outcome.
* Regardless of liquidity conditions, the cost curve is always upward sloping.\
  Buying more shares always results in increasing marginal costs.