Cost-Plus Pricing

Cost-plus pricing

A) is used only in oligopolistic market structures
B) simplifies pricing policy by adding a markup to average total cost
C) in actual practice leads to markups which are greater for more elastic demand curves
D) is likely to increase profits more than the use of marginal analysis
E) requires the firm to project the amount which will be sold and then "mark-up" the price based on average variable cost