Question

Manufacturers use __________ for deciding cost plus-pricing.

• A. Break-even analysis
• B. Production function analysis
• C. Decision making analysis
• D. Demand analysis

Answer 1

Answer: (A)

Break-even analysis

Break-even analysis is a way by which marketers can determine the lowest price at which a product can be sold. If the product is sold at anything lower than the break-even price, the company makes a loss. This is not something that any company can continue to do except for a very short period of time. So that, manufacturers use break even analysis for deciding cost plus pricing.