A Major Advantage of the Target Costing Approach to Pricing

question 106

Multiple Choice

A major advantage of the target costing approach to pricing is that target costing

• A)allows a company to analyze the potential profit of a product before spending money to produce the product.
• B)is not dependent on customers' quality-versus-price decisions.
• C)identifies unproductive assets.
• D)anticipates the product's profitability midway through its life cycle.

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Definitions:

Nigeria

is a country located in West Africa, known for its diverse cultures, languages, and significant oil and natural resources.

United States

A country located primarily in North America, composed of 50 states, a federal district, five major self-governing territories, and various possessions.

Sympathetic

Pertaining to the sympathetic nervous system, part of the autonomic nervous system that often accelerates heart rate, constricts blood vessels, and raises blood pressure, preparing the body for action.

Parasympathetic

refers to the part of the autonomic nervous system responsible for rest and digestion, countering the fight-or-flight responses of the sympathetic system.