Which of the following is a drawback of the cost-plus method?
A) The final price may be so high that the firm's competitiveness is compromised.
B) It is so variable that the actual price cannot be substantiated.
C) There is a high turnover of product resulting in cost fluctuations.
D) It is a time-consuming method.

Question

Quizplus · Accepted Answer

The cost-plus method may result in a final price that is so high that the firm's competitiveness is compromised, as it is based solely on the firm's costs and may not take into account market factors such as demand and competitors' prices.

Which of the Following Is a Drawback of the Cost-Plus