The objective of target pricing is to establish a price that will maximize profits given existing costs.

Question

Quizplus · Accepted Answer

Target pricing aims to determine the selling price of a product based on the desired profit margin and the market conditions, rather than maximizing profits based on existing costs. It focuses on working backwards from the market price to ensure the product can be produced within cost constraints to meet that target price.

The Objective of Target Pricing Is to Establish a Price