During the introduction stage of the product life cycle, firms are likely to use cost-plus pricing.

Question

Quizplus · Accepted Answer

Cost-plus pricing is commonly used in the introduction stage of the product life cycle, as companies need to recoup the high expenses incurred in developing and launching the product. This pricing strategy involves adding a predetermined profit margin to the product’s cost of production, thereby determining the final price.

During the Introduction Stage of the Product Life Cycle, Firms