Which factor is useful for correct pricing by an entrepreneur?
Answer and explanation
Correct answer: Understanding cost, customers’ ability to pay, and market conditions
Pricing should consider the cost of producing and delivering the offering, the value perceived by customers, their willingness or ability to pay, and competing market prices. Looking at these factors helps balance affordability, demand, and business viability. Therefore option A is correct. Guesswork, unjustified high prices, and ignoring customers can reduce sales or profit.
Frequently asked questions
What is the correct answer to this question?
Understanding cost, customers’ ability to pay, and market conditions
Why is this the correct answer?
Pricing should consider the cost of producing and delivering the offering, the value perceived by customers, their willingness or ability to pay, and competing market prices. Looking at these factors helps balance affordability, demand, and business viability. Therefore option A is correct. Guesswork, unjustified high prices, and ignoring customers can reduce sales or profit.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: MSME and Business Entrepreneurship.
