Even though cost-plus pricing is simple,it does not encourage a small business to use its resources efficiently.

Question

Quizplus · Accepted Answer

Cost-plus pricing sets a fixed profit margin on top of the cost of production or acquisition, regardless of whether the business is using its resources efficiently or not. This can lead to complacency and waste, as the business is not incentivized to reduce costs or operate more efficiently. Other pricing strategies, such as value-based pricing or dynamic pricing, may be more effective in encouraging small businesses to optimize their use of resources.

Even Though Cost-Plus Pricing Is Simple,it Does Not Encourage a Small