What Is the Critical Assumption When Using Target Profit Pricing

question 267

Multiple Choice

What is the critical assumption when using target profit pricing?

• A)a higher average price will usually cause the demand to fall
• B)a higher average price will always cause the demand to fall
• C)profit is relative to the current value of the dollar so this form of pricing is extremely risky
• D)a higher average price will not cause the demand to fall
• E)if the average price is increased,all a firm's competitors will do the same

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