Question

General Motors, in order to achieve a 15 to 20 percent profit on its investment, prices its automobiles accordingly. This approach is called ________.A) value-based pricing

B) value-added pricing
C) cost-plus pricing
D) low-price image
E) target return pricing (break-even pricing)

Answer 1

correct option is E) target return pricing

Step-by-step explanation:

given data

to achieve profit = 15 to 20 percent

solution

when this company want to gain of profit = 15 to 20 percent by investments

they must have used here target profit approach

because the target profit price will be a focus on the amount of unit sold so that cost will cover the achieved predetermine profit amount

so that here correct option is E) target return pricing