CLEP Marketing

Answer: E - Marketers realize that price markups are not desirable because they ignore consumer demand. Markup is calculated as the difference between the cost of manufacturing a product or providing a service and its selling price. Manufacturers and businesses add a markup to turn a profit from their product or service. Despite their convenience, price markups are often not desirable because they lead to suboptimal prices (either too low or too high). Suboptimal pricing can lead to the product not selling well and disconnects it from consumer demand.