Which of the following is not listed as a factor to consider when setting prices?

• A. Overhead costs
• B. Advertising costs
• C. Consumer perception
• D. Demand

Answer: (B)

Pricing is driven by three core ideas: covering the costs of delivering the offering (including overhead), aligning the price with how customers value the benefits (perceived value), and matching the price to market demand and how sensitive customers are to price changes. Advertising costs are marketing expenses, not a direct determinant of the price itself. They influence overall profitability and can affect demand by increasing perceived value, but they aren’t typically used as a standalone factor to decide what price to charge. So, among common price-setting considerations, overhead costs, consumer perception, and demand belong, while advertising costs are generally excluded as a direct pricing factor.