Why Is Cost-Plus Pricing Criticized

question 119

Multiple Choice

Why is cost-plus pricing criticized?

• A)It includes selling and administrative costs in determining the product cost.
• B)It does not consider the fixed manufacturing overhead in determining the product cost.
• C)It is inherently circular for manufacturing firms.
• D)It requires a high level of technical expertise to price products using this method.

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Definitions:

Moral Stages

Refers to the levels of moral development that individuals progress through, often conceptualized in the framework of theories such as Kohlberg's.

Respondent

An individual who answers or responds to a survey, questionnaire, or experiment.

Moral Development

The process through which individuals develop proper attitudes and behaviors toward other people in society, based on social norms, rules, and laws.