International Price Setting
The Comfy Couch Corporation (CCC) is a leading manufacturer of sofas, sectionals, and lounge chairs. Managers from the U.S.-based firm recently met a London retailer who expressed an interest in selling CCC lounge chairs in his stores. The retailer sells a number of different furniture brands in his stores, so CCC managers need to price their furniture appropriately if the firm is to be competitive in the European market.
-If CCC managers employ rigid cost-plus pricing they will most likely be unable to adjust for which of the following factors?

Question

International Price Setting 
The Comfy Couch Corporation (CCC) is a leading manufacturer of sofas, sectionals, and lounge chairs. Managers from the U.S.-based firm recently met a London retailer who expressed an interest in selling CCC lounge chairs in his stores. The retailer sells a number of different furniture brands in his stores, so CCC managers need to price their furniture appropriately if the firm is to be competitive in the European market.
-If CCC managers employ rigid cost-plus pricing they will most likely be unable to adjust for which of the following factors?

Quizplus · Accepted Answer

Rigid cost-plus pricing does not easily allow for adjustments based on market-specific conditions such as those in the English market, as it primarily focuses on adding a standard markup to the cost of production.