What is a critical reason for a company to use cost-plus pricing?
A)The company has significant differences between its variable and fixed costs.
B)The company's suppliers have recently increased prices.
C)The company operates in a highly competitive market.
D)The company operates in a less competitive market.

Question

Quizplus · Accepted Answer

Cost-plus pricing is more effective in less competitive markets where the company can easily add a markup to costs to ensure profit, as competition is not intense enough to force lower prices.

What Is a Critical Reason for a Company to Use