The pricing strategy in which the price set must cover the product cost plus target profit is classified as?
Correct answer: B. cost based pricing
- A. value based pricing
- B. cost based pricing
- C. discount based pricing
- D. ceiling based pricing
Explanation
Cost-based pricing starts with the product cost and adds the desired or target profit margin. Value-based pricing instead begins with the customer's perceived value, not the seller's cost.
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