REVIEW: You have an intern who is helping your team. She asked about the difference between cost-plus pricing and target-cost pricing. How would you best describe the question that is answered by a target-cost pricing strategy?

 
 
 
 
 
 

By using market price data, the target-cost pricing strategy allows companies to determine the fundamental issue of how much a product can cost and avoids some of the disadvantages of cost-plus pricing.