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The publishers sell to distributors at a discounted price. I.e., the big box retailers get the books at 40% off. Wal-mart and book clubs get them at a higher discount rate, but I don't know how high. Each retailer can then set a price.
i.e., because of the numerous markdowns of the Harry Potter book it was reported that no retailer actually made money on the sale of the Potter book.
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