Pricing That Involves Setting Prices Based on Competitors' Strategies,costs,prices and Market

question 106

Multiple Choice

Pricing that involves setting prices based on competitors' strategies,costs,prices and market offerings is known as ________.

• A)competition-based pricing
• B)target return pricing
• C)fixed cost
• D)penetration pricing
• E)price skimming

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Definitions:

Markup

The additional amount added to the cost of goods to cover overhead and profit.

Total Cost Concept

An approach in accounting that considers the total expenditure involved in producing or acquiring a product or service, including all direct and indirect costs.

Fair Markup

Fair markup refers to a pricing strategy that involves setting the selling price of a product at a reasonable profit margin above its cost.

Selling Price

The amount of money charged for a product or service, determining the revenue earned from sales.