In Spite of Its Failure to Account for Customer Value

question 78

Multiple Choice

In spite of its failure to account for customer value or customer demand, cost- plus pricing remains one of the most popular methods of price setting. Which of the following statements BEST accounts for its continued currency?

• A) It enables sellers to earn a fair return on investment.
• B) Sellers simplify the pricing decision using cost- plus approaches.
• C) Sellers are more confident about costs than demand or value.
• D) In markets where cost- plus pricing is widely practised, cost- plus results in competitors charging similar prices.
• E) All of the above are reasons for the widespread use of cost- plus pricing methods.

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Definitions:

Self-Recognition

The ability to recognize oneself as an individual separate from others, often tested through mirror recognition tasks.

Conservation

The protection and preservation of natural environments and resources, aimed at ensuring sustainability and biodiversity for future generations.

Embarrassment

A feeling of self-consciousness, shame, or awkwardness.

Object Permanence

The understanding that objects continue to exist even when they cannot be observed.