A "Cost-Plus" Pricing Approach Is

question 18

Multiple Choice

A "Cost-Plus" pricing approach is:

• A) A costing system that involves working out the cost of one unit and adding on extra for the selling price in order to make a profit
• B) A costing system that includes the basic direct costs of the product, plus all of the overheads of running the factory as a separate cost total
• C) The direct cost of producing the products sold in the month plus the cost of any unsold inventory
• D) Used in job costing - for example the cost of the raw materials plus the labour required for a building job

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Definitions:

Downward Pressure

Forces or factors that lead to a decrease in prices, wages, or other economic indicators.

European Union

A political and economic union of 27 European countries that are located primarily in Europe, aiming to promote peace, stability, and economic cooperation among its members.

Capital Mobility

The ease with which capital or investments can move across borders in response to differences in return or risk, impacting global trade and investment decisions.

Common Labor Laws

Laws that regulate the legal obligations between employers and workers, including wages, working hours, safety, and rights to organize.