What it means
A jeweller may quote a per-gram figure to value the metal in a piece, but the number is incomplete without purity, currency and time. A 24-carat rate cannot be applied unchanged to 18-carat jewellery.
Carat describes gold purity, not weight: twenty-four carat represents nearly pure gold, while 18 carat contains about 75% gold and other alloy metals. Gold's global market often quotes per troy ounce, and the World Gold Council gives one troy ounce as 31.1034768 grams.
It also notes that gold has spot, LBMA and regional prices, and identifies the LBMA Gold Price as one important benchmark. There is no single world retail gold rate, and a local association may publish indicative rates, but shop terms still matter.
A simple pure-gold-content estimate multiplies a 24-carat metal rate by carat divided by 24, so at a fictional rate of $80 per gram for 24 carat, 22-carat gold content would be about $73.33 per gram. This is not a guaranteed retail price.
Real marks can use fineness rather than exact carat fractions, since the World Gold Council notes that some 14-carat jewellery is marked 585 rather than the mathematical 583, so read the tested or hallmarked purity when a precise valuation matters. The quoted local retail rate may include commercial spread, currency conversion and market practice, and a shop's buyback rate can be below its selling rate.
Do not tell a customer one posted price covers both directions. Prices move as international gold prices and currencies change, so the rate should carry an "as of" time and yesterday's figure should not be repeated as today's fact.
Making charges pay for design and fabrication, and they may be stated per gram, per item or as a percentage in a specific shop. Keep them separate from the base metal-value calculation.
Gemstones, settings and other materials also affect jewellery price, so total item weight is not always pure metal weight and a ring's stone should not be multiplied by the gold rate as if it were gold. Applicable sales taxes or duties depend on jurisdiction and transaction, so ask each seller for weight, purity, rate, making charge and taxes on the same day and compare the final payable amount.
A customer selling old jewellery may face testing, weight deductions and buyback terms, so a gross per-gram multiplication is only a preliminary estimate. For inventory, a jeweller should distinguish historical acquisition cost from current market replacement cost, because a change in the posted rate does not automatically tell an accountant how to value stock under reporting rules.
In practice
Real-world examples.
Example
A shop posts a dated 22-carat selling rate per gram in its local currency. The board states the time of the quote, and the sales assistant explains that making charges and tax are added on the invoice. A customer comparing two shops asks each for the same-day itemised figures.
Example
A customer requests a separate buyback quote for tested 21-carat old jewellery. The jeweller tests the purity, weighs the pieces net of any stones and applies its stated deductions. The net payable is lower than the gross weight multiplied by the selling rate.
Example
A jeweller itemises metal value, making charge and applicable tax on the invoice. An invented retailer might update display prices once a day while wholesale metal costs change during its trading hours, so the manager checks the supplier's actual replacement quote and pricing policy. The customer sees which part of the price is metal and which part is service.
Formula
Calculation
Illustrative metal-content estimate per gram = pure-gold benchmark per gram x (carat / 24). At $80 x (22 / 24), the estimate is about $73.33 per gram. Retail spread, making charges and taxes are separate.
To cross-check a market quote, convert ounces to grams: price per gram = price per troy ounce / 31.1034768. If gold is quoted at $2,400 per troy ounce, the 24-carat price is $2,400 / 31.1034768 = about $77.16 per gram. If the quotation is in another currency, convert to dollars per gram first and then apply a current currency rate.
For 18-carat jewellery the metal-content estimate is $77.16 x (18 / 24) = $77.16 x 0.75 = about $57.87 per gram. A 10-gram 18-carat chain therefore contains roughly $57.87 x 10 = $578.70 of gold before making charges, spread and tax.Case study
Seen in the real world.
This entirely fictional case follows Al Safa Gold, an invented jeweller. Staff quoted a base metal rate without explaining that making charges varied by design. Customers who compared shops by the headline gram rate sometimes found the final invoice higher than expected. The shop added itemised quotes with purity, rate time and other charges.
It also trained staff to explain that a buyback offer uses a different rate from a sale and deducts testing and stone weight. The manager later reviewed how stock was valued, separating historical acquisition cost from current replacement cost for the accounts. The example asserts no change in customer trust or margin.
Watch out
Common mistakes.
- Treating an old or undated quote as current.
- Applying a 24-carat rate to the whole weight of lower-purity jewellery or stones.
- Comparing metal rates without making charges, spreads and tax.
Questions
People also ask.
Why do rates differ by carat?
Lower-carat alloys contain less gold per gram, although final retail prices include other factors.
Who sets the rate?
Global benchmarks, local markets and individual sellers all influence quotes; specify which rate you mean.
Does it include making or tax?
Not necessarily. Ask for a dated, itemised quote with all additions.
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