Average-Cost Pricing

Multiple Choice

Average-cost pricing

A) always results in a profit that is less than what was expected.
B) will work out as expected when the firm's actual average fixed cost per unit is what was estimated when prices were set.
C) sets the price at the point where average fixed cost is equal to average variable cost.
D) ignores variable costs.
E) is the only way to ensure that the firm will set a profitable price.