Question

FOB origin pricing refers to

a. a method of "free on board" pricing where the price the seller sets includes all transportation costs.

b. a method of pricing where taxes and tariffs are adjusted based upon the city, state, or country of origin of a product and not its destination.

c. the "free on board" (FOB) price the seller quotes that includes only the cost of loading the product onto or into a vehicle and specifies the name of the location where the loading is to occur (seller’s factory or warehouse).

d. a method of pricing where taxes and tariffs are adjusted based upon the city, state, or country destination of a product and not its place of origin.

e. the buyer’s naming the location of this loading as the seller’s factory or warehouse.

Answer 1

C. the "free on board" (FOB) price the seller quotes that includes only the cost of loading the product onto or into a vehicle and specifies the name of the location where the loading is to occur (seller’s factory or warehouse).

Explanation: FOB-origin pricing is a geographical pricing strategy in which goods are placed free on board a carrier; the customer pays the freight from the factory to the location.

FOB origin (Free on Board origin) – The shipping cost from the factory or warehouse is paid by the purchaser. Ownership of the goods is transferred to the buyer as soon as it leaves the point of origin. .Uniform delivery pricing – (also called postage stamp pricing) The same price is charged to all.

FOB value is the value of goods excluding carriage, insurance, and freight, i.e. roughly speaking, the domestic price in the country of origin.