The main advantage that marginal analysis has over most other popular pricing methods is that it:
A) Considers both fixed and variable costs.
B) Takes into account the break-even point.
C) Allows managers to evaluate pricing alternatives.
D) Takes into account both costs and demand.
E) Incorporates the markup chain.

Question

Quizplus · Accepted Answer

Marginal analysis considers the additional costs and benefits of producing one more unit of a good or service, which inherently involves looking at both costs (including variable and sometimes fixed) and demand to determine the optimal pricing and production levels. This approach allows businesses to make decisions based on the incremental impact of those decisions, making it a powerful tool for pricing and production planning.

The Main Advantage That Marginal Analysis Has Over Most Other