O The cost of marking a product and the desire profit margin are the two primary determinants in a value- based price O Value-based pricing takes customer needs into account, but fails to consider customers' price sensitivity O Competition-based pricing starts with a good understanding of customer needs and benefits that a product offers relative to competitors' products O The business with the lowest price offers customers the best economic value

O The cost of marking a product and the desire profit margin are the two primary determinants in a value- based price O Value-based pricing takes customer needs into account, but fails to consider customers' price sensitivity O Competition-based pricing starts with a good understanding of customer needs and benefits that a product offers relative to competitors' products O The business with the lowest price offers customers the best economic value

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter11: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 8DQ: Although the cost-plus approach to product pricing may be used by management as a general guideline,...

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