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

question 44

Multiple Choice

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.

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Definitions:

Federal Mandate

Regulations that the federal government imposes on state and local governments to carry out certain policies.

Federal Expenditures

The spending by the federal government of a country, including on defense, education, public welfare, and infrastructure projects.

Average Tax Rate

The portion of total income paid in taxes, calculated by dividing the total amount of taxes paid by the taxpayer's total income.

Taxable Income

The amount of income subject to taxes, determined by subtracting deductions and exemptions from gross income.