In target pricing,the target sales price is the ________.
A)total product cost incurred in producing a product
B)net profit desired by the company
C)amount customers are willing to pay for a product or service
D)price calculated by deducting the desired profit from the total production cost

Question

Quizplus · Accepted Answer

In target pricing, the target sales price is determined by the amount customers are willing to pay for a product or service. This approach involves starting with the price that the customer is willing to pay and working backwards to determine the production cost and desired profit. Therefore, choice C is the best option. Option A is incorrect because total product cost is not the focus of target pricing. Option B is also incorrect because the desired profit is considered after the target sales price is determined. Option D is incorrect because it assumes that the desired profit is deducted from the total production cost, rather than being based on the target sales price.

In Target Pricing,the Target Sales Price Is the ________