Which of the following presents the strongest reason that markup pricing is generally illogical?
A)Sellers earn a fair return on their investment.
B)By tying the price to cost, sellers simplify pricing.
C)When all firms in the industry use this pricing method, prices tend to be similar.
D)This method ignores demand.
E)With a standard markup, consumers know when they are being overcharged.

Question

Quizplus · Accepted Answer

Markup pricing ignores demand, which is a crucial factor in determining prices. It assumes that consumers will always be willing to pay a certain amount regardless of the market conditions, which is not always the case. This can lead to either under or overpricing of products, resulting in lost sales or reduced profits.

Which of the Following Presents the Strongest Reason That Markup