When the Ideal Selling Price Is First Determined and the Feasibility

question 63

Multiple Choice

When the ideal selling price is first determined and the feasibility of meeting that price is assessed and costs are controlled in order to produce the product that can be sold at the target price,this is called:

• A)market development.
• B)price determination.
• C)target costing.
• D)product development.

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Definitions:

Value-Based Pricing

A pricing strategy where the price is based on the perceived value of a product or service to the customer rather than on the cost of production or a traditional market price.

Operating Cost

Expenses associated with the day-to-day activities of running a business, excluding costs related to financing and investments.

Useful Life

The period of time over which an asset is expected to be useful in the operations of a business.

Traceable Fixed Expense

A fixed expense that can be directly linked to a specific department, project, or segment of a business.