Setting the Price of a Product or Service by Adding

question 59

Multiple Choice

Setting the price of a product or service by adding a fixed percentage to the total unit cost is referred to as

• A) cost-plus fixed-fee pricing.
• B) demand backward pricing.
• C) cost-plus percentage-of-cost pricing.
• D) experience curve pricing.
• E) target return on investment pricing.

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Definitions:

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a specific price level, at a given point in time.

Equilibrium Price

is the price at which the quantity demanded of a good equals the quantity supplied, leading to market balance.

Eurotunnel

A major infrastructure project, also known as the Channel Tunnel, that connects the UK and France beneath the English Channel.

Commercial Traffic

The movement of goods and services or the flow of commercial transportation vehicles within a specified area or route.