Question

Which of the following statements is true of pricing decisions?

A) The business with the lowest price will always offer customers the best economic value.

B) It is possible to implement market-based pricing with low levels of customer and competitor intelligence.

C) Cost-based pricing takes into account what the customer would be willing to pay for a certain level of product performance.

D) Competitors' product-price positioning and company product-price positioning are the two primary determinants in setting a cost-based price.

E) Market-based pricing starts with a good understanding of customer needs and the benefits that a product offers relative to competitors' products.

Answer 1

Market-based pricing starts with a good understanding of customer needs and the benefits that a product offers relative to competitors' products. Option e

Step-by-step explanation:

Among the statements provided, the one that is true of pricing decisions is option E) Market-based pricing starts with a good understanding of customer needs and the benefits that a product offers relative to competitors' products.

Market-based pricing is a strategy that focuses on setting prices based on the perceived value of a product or service in the market. It involves conducting market research, understanding customer preferences, and comparing the benefits of a product with those of competitors.

In contrast, option A is not always true since the lowest price does not always offer the best economic value. Option B is incorrect as market-based pricing requires a good understanding of the market and competitors. Option C is incorrect as it describes value-based pricing rather than cost-based pricing.

Option D is also incorrect as cost-based pricing primarily considers the costs of production and does not solely rely on competitors' positioning. Option e