Which of the following statements is most accurate?
A)Nonprofit organizations are exempt from having to cover costs of producing and/or marketing their products.
B)Socially responsible corporations should have the pricing objective of covering all costs of producing and marketing a company's product, but they should not price their products to earn a profit.
C)Regardless of a company's objectives, a firm must cover all the costs of producing and marketing product or the firm will fail.
D)Elasticity of demand makes it virtually impossible for companies to cover all their marketing and production costs at all times.
E)Marketing and production costs are the most difficult and expensive aspect of pricing because they draw so much capital away from other departments in the organization.

Question

Quizplus · Accepted Answer

This statement is most accurate because it highlights the importance of covering all costs of producing and marketing a product. If a firm does not cover these costs, it will not be able to sustain its operations and will ultimately fail. While socially responsible corporations may not want to price their products to earn a profit, they still need to cover their costs to remain viable. Nonprofit organizations may be exempt from certain taxes or regulations, but they still need to cover their costs to continue operations. Elasticity of demand can impact a firm's ability to cover costs, but it is not impossible to do so. Finally, while marketing and production costs can be expensive, they are not necessarily the most difficult or costly aspect of pricing, as other factors such as competition and consumer preferences also play a role.

Which of the Following Statements Is Most Accurate