Despite its weaknesses, markup pricing remains popular for which of the following reasons?
A) Sellers can determine demand much more easily than they can estimate costs.
B) By tying the price to cost, the pricing task becomes more sophisticated.
C) When all firms in the industry use markup pricing, price competition flourishes.
D) Sellers take advantage of buyers when the latter's demand becomes acute.
E) Many people feel that cost-plus pricing is fairer to both buyers and sellers.

Question

Quizplus · Accepted Answer

Many people perceive cost-plus pricing as a fairer method of pricing for both buyers and sellers. Despite its flaws, markup pricing remains popular because some individuals prefer a pricing approach that is perceived as decent for both parties. Cost-plus pricing often leads to higher consumer trust and loyalty because customers feel that they are being charged fairly, which leads to a better reputation for the seller.

Despite Its Weaknesses, Markup Pricing Remains Popular for Which of the Following