Firms with high fixed costs often expand their markets,quoting the same prices to all customers regardless of shipping expenses,under the plan called:
A)zone pricing.
B)freight absorption pricing.
C)uniform-delivered pricing.
D)the basing-point system.

Question

Quizplus · Accepted Answer

Freight absorption pricing is when firms with high fixed costs quote the same price to all customers regardless of shipping expenses. This helps the firm to expand their markets by absorbing the shipping expenses as a cost of doing business. This is a common strategy used by firms with high fixed costs, such as manufacturers of large products like furniture or appliances.

Firms with High Fixed Costs Often Expand Their Markets,quoting the Same