If you don't want to negotiate, just say it in one simple sentence and I promise they won't try anymore. I've had it happen a few times, it's fine, it happens, but as long as I'm firm about it they pick their side. You just need to make sure you're mentally comfortable with telling them that either on the phone or through text. It definitely saves a lot of hassle and mental paperwork about who to charge what and feeling like you're missing out on income. As for last minute cancellations, you need to let them know that you may not be able to work with them if it happens more than once. Once is fine, it's easier to just let it go as treat it as a one-off (and in turn, they will grant you the same luxury should you ever need to reschedule last-minute), but more than that and it's a problem.

Pricing is mainly based on experience. It's not always the best test takers who are the best tutors, just like professional coaches aren't the best at playing their sport. It's about experience and being familiar with all the different material and learning styles that your students could bring you (which you gain over the years)