ITPEC FE Subject A April 2025 Question 51
ITPEC FE Subject A April 2025 — Question 51 of 60
Cost-plus pricing sets price by adding a fixed margin on top of manufacturing and purchasing costs.
The key word is "adding a certain margin to costs" — price flows directly from cost, not from market or customer research.
Why not others:
- (a) — describes competitive pricing (benchmarks against rivals)
- (c) — describes target profit pricing (starts from desired profit at a sales volume)
- (d) — describes value-based pricing (price driven by customer perception)
Key rule: Cost-plus = cost + markup. Simple formula, no market research involved.
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