Which statement below is the most correct about the cost-plus approach to pricing
A)If the projected selling price is greater than 125% of the projected cost, the product will not be offered to customers.
B)There is a risk that product developers will create products with expensive features that customers may not pay for.
C)There is considerable pressure to get rid of unnecessary costs.
D)The cost of the product is determined by working backwards from the projected selling price.

Question

Quizplus · Accepted Answer

The cost-plus approach to pricing involves setting a price by adding a markup to the cost of producing a product or service. This can lead to a risk that product developers will include expensive features in a product that customers may not value enough to pay for, as the focus is on covering costs plus a markup rather than on what the market will bear.

Which Statement Below Is the Most Correct About the Cost-Plus