Which of the following statements is true of the cost of producing a product?
A) It controls pricing in highly competitive markets.
B) It affects the willingness of a company to supply a product.
C) It includes manufacturing costs, but not product design costs for pricing decisions.
D) It is not a factor to be taken into account while pricing a product.

Question

Quizplus · Accepted Answer

The cost of producing a product affects the willingness of a company to supply it. If the cost of production is too high, the company may not be willing to supply the product at a certain price point. While cost does not control pricing in highly competitive markets and does include both manufacturing and product design costs for pricing decisions, it is still a factor to be taken into account while pricing a product. Therefore, option B is the correct answer.

Which of the Following Statements Is True of the Cost