The pricing strategy which starts with ideal price and targets the cost which ensures that set price will be met is classified as?
Correct answer: A. target costing
- A. target costing
- B. marginal costing
- C. learning curve costing
- D. demand based costing
Explanation
Target costing begins with the price customers are expected to accept and subtracts the required profit to determine the allowable production cost. Marginal costing and demand-based costing do not specifically reverse-engineer cost from a target selling price.
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