Jian has entered into a contract with the federal government to design a computer simulation model for training helicopter pilots. The contract calls for the final price to be set at a fixed percentage profit over and above her cost of production. This seems to represent a:
A) cost-based pricing strategy.
B) supply and demand formula.
C) demand-based pricing strategy.
D) price leadership pricing strategy.

Question

Quizplus · Accepted Answer

The contract's pricing strategy is based on Jian's cost of production, indicating a cost-based pricing strategy.

Jian Has Entered into a Contract with the Federal Government