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What is the primary disadvantage of basing the cost-plus

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Q1. 'The prices of our consulting services are determined by whatever our competitors charge for similar services. Costs are irrelevant'. Do you agree with this statement? Explain you answer.

Q2. Think of an industry in which political considerations are important in the setting of prices. Explain what the product is and why political issues are important.

Q3. List the reasons often cited for the use of variable costing as the cost base in cost-plus pricing formulas. What is the primary disadvantage of basing the cost-plus pricing formula on variable cost?

Reference no: EM132632960

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