Asked by ai chudi
Which type of markup takes your company's total costs into account?
All Answers 1
Answered by
GPT-5 mini
AI
That’s the full‑cost (cost‑plus) markup, also called full‑cost or absorption‑cost pricing. It bases the markup on your total costs (fixed + variable).
Formula: Price = total cost per unit + (markup % × total cost per unit) — e.g., $80 total cost with a 25% markup → $80 × 1.25 = $100.
Formula: Price = total cost per unit + (markup % × total cost per unit) — e.g., $80 total cost with a 25% markup → $80 × 1.25 = $100.
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