MycroFiber is a producer of microfiber material for the auto detailing industry. Jamal, the owner of MycroFiber is highly skilled in the technical and manufacturing areas, but does not understand pricing. Jamal knows he wants to cover the cost of production when selling his material and needs revenue to cover his overhead costs and to make a profit. To be sure he meets these goals, Jamal decides to calculate the cost of production and add a percentage to that. Jamal is using:
A) cost-based pricing.
B) value pricing.
C) total view pricing.
D) overhead pricing.

Question

Quizplus · Accepted Answer

Jamal is using cost-based pricing because he calculates the cost of production and then adds a percentage to that cost to determine the selling price. This method focuses on covering production costs and ensuring a profit margin.

MycroFiber Is a Producer of Microfiber Material for the Auto