Practice question · Select all that apply
Which are genuine weaknesses of pure cost-plus pricing?
Hints
- The weakness is blindness, not effort.
- Knowing your own cost is a requirement, not a flaw.
Show the answer
- A. It can price you out of the market when costs are high
- C. It ignores competitors’ prices
- D. It ignores customers’ willingness to pay
Why
Knowing your cost is a feature, not a flaw. The blindness to demand and competition, and the death spiral when high costs force high prices, are the real weaknesses.
Practise Pricing Strategies
The app has 6 more questions on this lesson, and keeps your place in the course. Business I is free to start.
More questions on Pricing Strategies
- Penetration pricing aims to maximize profit on each unit sold from day one.
- A product costs 60€ to make and sells with a 25% markup on cost. Set the slider to its price in €.
- Sort each real-world price into its strategy.
- Match each pricing method to the condition where it shines.
- Why can a cinema profitably charge students less than adults for the same seat?
- A software firm charges 9€ a month for individuals and 90€ per seat for enterprises, shipping identical code.…
- Versioning sells a cut-down product alongside a full one, sometimes by disabling features already built. Why…