The pricing approach that: (1)estimates the price that ultimate consumers would be willing to pay for a product; (2)works backward through markups taken by retailers and wholesalers to determine what price to charge wholesalers; and (3)results in the manufacturer deliberately adjusting the composition and features of the product to achieve the target price to consumers is referred to as __________.
A)cost-benefit pricing
B)cost-plus percentage-of-cost pricing
C)target pricing
D)cost-plus fixed-fee pricing
E)product feature pricing

Question

Quizplus · Accepted Answer

The description given matches the approach of target pricing, where the manufacturer determines the price that the consumers are willing to pay for a product and then adjusts the product's features and composition to achieve the target price. This approach considers markups taken by intermediaries such as wholesalers and retailers in order to determine the price to charge wholesalers.

The Pricing Approach That: (1)estimates the Price That Ultimate Consumers